Remarks by Ambassador Michael W. Michalak

Ambassador Michael Michalak
1st Anniversary Press Conference

August 20, 2008

Ambassador Michalak: [Opening remarks in Vietnamese].

And with that, I’m going to switch to English. [Laughter].

I’m a little nervous. I’ve never really had a First Anniversary before. This is something new for me.

I think one of my best accomplishments during this first year has actually been to learn a little bit of Vietnamese, and I’ll tell you, it’s a really hard language.

I think that perhaps one of my greatest accomplishments during my first year here was the extremely successful visit of Prime Minister Nguyen Tan Dung to Washington to meet with President Bush.

My main objective as Ambassador to Vietnam is to broaden and deepen the trust, the friendship and the relationship between the United States and Vietnam. I think that through the visit of Prime Minister Dung, the two leaders took our relationship to a new level.

We continue to talk about our economic and trade relationship which is extremely important and in many ways has been central to our relationship. We also signed some very important agreements and talked in detail about education, about climate change, and about security and cooperation between our two countries which I believe was something new in our relationship.

As you know, when I first came to Vietnam I told everybody that I had three priorities. I actually now have four priorities, and I’ll tell you about the fourth one in a few minutes.

One of my priorities was to continue to deepen and expand our economic and commercial relationship. In the statement that we handed out you will see some numbers there which indicate that our relationship has indeed been strengthened. Two way trade has gone up a great deal. There are many other accomplishments in this field that took place during my first year.

In all of the accomplishments of these last twelve months, you will see a strong connection to the priorities of the government of Vietnam as well. In the economic and commercial field, for example, the Prime Minister asked during his visit to Washington that we open our market to tropical fruits from Vietnam. I just recently saw that the first two containers of dragon fruit are about ready to be shipped to the United States so we’ve made some progress in that area.

When I had my introductory meeting with the Prime Minister he noted that each Ambassador from the United States to Vietnam has had some major trade event associated with him. Ambassador Peterson and Ambassador Burkhart worked very hard on the Bilateral Trade Agreement. Ambassador Mike Marine worked very hard on WTO accession and permanent normal trade relations for Vietnam.

The Prime Minister suggested to me that maybe what would be appropriate for me would be to have a Bilateral Investment Treaty signed with Vietnam. Well guess what? During the visit of the Prime Minister we agreed that we would start negotiations on a Bilateral Investment Treaty with Vietnam. This is another thing that has matched both the interests of the United States and the interests of Vietnam.

You all know that education has been one of my main interests and that I have spoken and I have worked very hard on trying to improve the education relationship between the United States and Vietnam. I promised before I even came to Vietnam that I would do my best to double the number of students going from Vietnam to the United States.

Well, the number of student visas for kids going to the United States to study is now up by 70 percent from one year ago so I think I’m well on the way towards meeting that goal. During the visit of the Prime Minister to Washington we also signed a Memorandum of Understanding which creates a Vietnam-U.S. Task Force on Education. We will be working very hard with our counterparts from Vietnam to find ways to increase the cooperation between our two countries.

I also said that one of my other priorities was to continue discussions with the government of Vietnam on human rights. While we do have some differences in that area we also have many areas of commonality in which we have made progress. There have been delegations from the government of Vietnam going to the United States to study the American system, and we have a rather large delegation that will be going to continue those studies. Religious freedom continues to progress here in Vietnam with more churches being registered and more opportunities for people to worship as they please.

Of course we still have differences and we have an annual human rights dialogue during which we address those differences in an atmosphere of mutual respect. I think there are many areas where we can cooperate even further. We both agree that strengthening the National Assembly is a good idea and we’re looking for ways to provide technical assistance in that area. We agree that improving the legal system, setting up a lawyers association and writing a law on associations that will allow non-governmental organizations to help Vietnam even more, is also a good idea. We look forward to continued cooperation in those areas. And anti-corruption is an area in which everyone can agree there’s room for improvement everywhere in the world, bas well as here in Vietnam. Transparency is the greatest enemy of corruption and we are trying to work with the government of Vietnam to improve transparency in financial transactions, in legal transactions, and in dealings overall between the people and the government.

So while I’ve not made all the progress I’d like to make in that area, I think we have done a good job in moving forward.

My fourth priority has been to try to buy land for a new Embassy of the United States of America. (Laughter.) You may think that’s funny, but if you walk through this building and through the other buildings that we have around town and see how crowded they are with our people, you will see we need a new Embassy. I intend to continue to talk with every high level official I can until we get that deal done.

Overall my goal here has been to increase trust and increase the confidence of the Vietnamese people and the government and the Party in the United States. I do that by trying to get out and meet as many people as I can and by trying to meet with government officials and Party officials and ordinary Vietnamese. Which is why I’m trying to learn to speak Vietnamese.

But if anyone doubts the intentions of the United States of America, I think that President Bush, again during the visit of Prime Minister Dung to Washington, summed it up very well. He said it in the Joint Statement when President Bush reiterated the U.S. Government’s support for Vietnam’s national sovereignty, security and territorial integrity.

During my first year here I have come to enjoy life in Vietnam even more, and to really enjoy meeting people and getting to be friends so many here in Vietnam.

The United States wishes Vietnam only all the best, and I’m here to do what I can to help make that happen.

With that, let’s open it up for questions.

Question: I’m from Vietnam Economic News.

In the statement that we received, we see that there have been many developments in the relations between the two countries and there are many achievements too. But there remains one issue. That is the coordination between the two countries to address the issue of victims who were exposed to Dioxin. We have heard of a multi-million dollar project but we don’t know what plans for the next steps are.

Would you please tell us what plans, or what steps you will take to address that issue?

Ambassador Michalak: At the present time we have $3 million that we can use for remediation and environmental projects here in Vietnam. We are almost ready to begin the first project which will start, I would imagine, within the next two to three months. We are in the final stages of coordination with the government of Vietnam on which project proposal is the most suitable for our purposes.

We are also working with other like-minded nations to try to coordinate our assistance to remediate pollution levels and to provide assistance to people with disabilities regardless of cause and we intend to continue to do that.

We are in active consultation with Office 33 and we will continue this consultation to decide on what projects we might work on going forward. In fact as I mentioned, we’re in consultations with the Office 33 and in fact next month we will hold our next meeting of the Joint Action Committee here in Hanoi to look at Dioxin and other pollution problems.

I also think we need to talk a little bit about unexploded ordnance as well. UXO is also a huge problem here in Vietnam.

I just recently visited Quang Tri Province to talk with many of the NGOs that are working on this issue. We intend to meet with representatives of the government of Vietnam to continue to talk with them and try to find ways in which we can increase our assistance on this particular issue. This is something that is of great concern to me and that I really want to work on very hard.
 
You guys have got to tell me whether I’m smiling or not, because last time I was down in Ho Chi Minh City I was at a meeting with some congressmen, and they took a picture of us during a meeting with the Ho Chi Minh City Peoples Committee. And it looked so serious. [Laughter]. Everybody was asking me gee, what were you so angry about? [Laughter]. We weren’t angry, it was a great meeting, but for some reason I guess it was the last meeting of the day and we were kind of tired, so we were sitting there -- [Laughter].

So please, if you have a picture like that, don’t put it in the paper. [Laughter]. I’ll try to smile more.

Next question.

Question: I’m from Vietnam Net. My question is, would you please let us know what is going on with the opening of a new U.S. Consulate in Danang? Also, do you know anything about the opening of a new Vietnamese Consulate in Houston?

Ambassador Michalak: Let me say first that your sources of information are very good. [Laughter]. All I can tell you is at this point we are in active discussion with the Ministry of Foreign Affairs on a wide range of consular issues including that issue. Nothing’s been decided yet, but we’re definitely engaged on this. In fact I think we’re probably going to have another meeting next week on it. It’s a very complicated issue and you really don’t want to hear much more about it. But we’re aware of the strong interest of the government of Vietnam and they’re aware of our strong interest, so we’re going to work very hard on that.

Question: I’m from Saigon Marketing Newspapers.

I would like to learn more about your plan to have a new U.S. Embassy which is also your fourth priority. I have heard rumors that you want a lot of land, a piece of land in My Dinh area near the National Stadium. [Laughter].

Ambassador Michalak: That’s one thing about Saigon. There’s always rumors floating around. [Laughter].

No, it’s not there. It’s further out towards the western part of Hanoi. Everybody knows, but I’d rather not say it because we’re still in negotiations. But there are rumors floating around Hanoi too. Check out some of those rumors. [Laughter].

Question: I learned that the U.S. House of Representatives is considering a draft bill on the textile monitoring program which is an extension of the existing program. What is the view of the U.S. government about this program? Do you think that the program will be expanded during the Bush Administration?

Ambassador Michalak: As you know, the current textile monitoring program will go away at the end of this Administration. There is a draft bill. I really don’t know the current status of it. I know that it has been introduced, but I'm not sure if it’s even gone to committee yet so it’s just at the very early stages of deliberation by the Congress. I think I want to wait to see how much support it has and where it goes. There’s a lot of politics involved at the end of an Administration. So at this point it’s a little bit premature to say exactly what’s going to happen, but we are monitoring the situation very carefully. In fact the last congressional delegation that came through here had not even heard about the bill. So it’s still very very new.

Question: Ambassador, you said the U.S. and Vietnam have started on the investment agreement, bilateral investment. So how far has this gone, has a committee been set up? Thank you.

Ambassador Michalak: We just had the agreement during the Prime Minister’s visit to begin negotiations. We’ve had some preliminary talks already. In fact I think we’ve had several sessions of preliminary talks.

We’re still finalizing the dates for the first round of talks. I would expect them to happen sometime in September or October.

Question: I’m from Health and Life Newspaper.

Would you please give some remarks about cooperation between the U.S. and Vietnam on health issues? Will you also please talk about PEPFAR programs, the President’s emergency program for AIDS Relief. Also how much has been done on AIDS in the first half of 2008?

Ambassador Michalak: Wow, how much has been done in the first half of 2008? There are so many different projects and numbers out there on exactly how many people are being treated with anti-retroviral drugs, how many people are being treated under methadone programs, how many people are being counseled. It’s very hard to give you the full picture of our work in our limited time. I would suggest you to go to our PEPFAR office to get the exact numbers – you can find a great deal of information and statistics on those efforts on our website.

I can tell you that over the past four years we have gone from a program of about $20 million a year, to a program this year which is about $88 million a year. We have focused on six provinces and we are now thinking of expanding that to seven or eight.

At the same time that we’re working on PEPFAR which is focused on people living with HIV/AIDS, we are also working on a number of other health-related issues like Avian Influenza.

In all of these programs we are working in a multilateral, multinational effort, but I think that in many ways the U.S. is providing a lot of leadership in this area.

Many of our USAID programs are helping improve clinics for disabled people. We are working in terms of providing capacity building for many different health areas around Vietnam. I think that we’ve got a very broad and deep program in the health area here.

One of the major events of my first year was the visit of the Secretary of Health and Human Services from the United States who came here and had very successful meetings with the Ministry of Health and other health-related ministries in Vietnam.

So this is an area where I look for expansion in our programs, and we’re talking now with the government of Vietnam to review all of our health programs and see what areas we might want to expand into in the future.

Question: I’m from Youth Newspapers.

My question is, why do the U.S. and Vietnam still need a Bilateral Investment Treaty when Vietnam has already entered the WTO and Vietnam and Japan also had investment treaty which really opened up the door for investment. We can see that the number of FDI is so great. So what do the U.S. and Vietnam expect from having a BIT?

Ambassador Michalak: We do already have investment - under the BTA, the Bilateral Trade Agreement, under the WTO, and we have further discussions on investment under the TIFA or the Trade and Investment Framework Agreement. And many of our agreements are what we call WTO-Plus. In other words they call for greater liberalization and greater commitments on the part of the U.S. and Vietnam than exists in WTO.

The Bilateral Investment Treaty will actually bring certain legal protections in our two countries up to what we consider the gold standard or the best international standard for investment protection that exists in the world today. This will give an added level of confidence to American investors who want to invest in Vietnam. The more confident and the safer foreign investors feel, the more they want to invest.

So I believe that having a Bilateral Investment Treaty will attract even more investment to Vietnam.

Question: I’m from AFP.

After your one year in Vietnam what do you think is the biggest change, positive or negative, in terms of human rights, religious freedom and press freedom in Vietnam? And what do you think is the biggest problem that you on behalf of the U.S. government would push Vietnam to do in order to improve the situation? Thank you.

Ambassador Michalak: I would say the biggest problem is still freedom of expression. Even though the Vietnamese constitution guarantees its citizens the right to freely express their views, and freedom of expression is certainly a key value in the United States, there are two different definitions of freedom of expression -- one in Vietnam and one in the United States.

We believe that more freedom of expression allows more participation, more communication between the people and the government and we believe this is a good thing.

In terms of press freedom, we remain concerned about the recent arrest of journalists. We think this has a negative effect on other journalists who want to be free to report whatever stories they might find. We hope that as soon as possible the government will publish a full explanation of exactly what the charges were, what they found out about the case, and the ultimate results of the investigation.

Now while we have these differences, I do want to reiterate that there are still many ways in which the government is trying to allow more participation, particularly by businessmen, in the economic decisionmaking process.

Again, I think there may be a confidence building process going on here as well. As the government develops more confidence in the people themselves, then maybe there will be more freedom of expression. We’ll wait and see.

On religious freedom, as I’ve said, I think we’ve seen a lot of progress in this area, but what we’re seeing particularly out in the provinces is that there are officials who do not seem to understand the laws of the government of Vietnam. In some places the authorities continue to harass people who are trying to express their religion, whereas in other provinces it’s completely free and open.

We hope the government will increase its efforts to educate those in some of the provinces who don’t seem to understand the law, in order to help them understand better exactly what is permitted under the law.

Question: I’m from Investment Newspaper.

During the visit of the Prime Minister to the U.S., the U.S. made several commitments to assist Vietnam in education, in climate change, and in granting GSP status to Vietnam. Would you please tell us so far how these commitments been implemented? What is the progress?

With regard to GSP particularly, when do you think Vietnam will get that status? I learned that the U.S. has presented some requests for Vietnam and Vietnam should meet those requirements before it can be grant GSP to Vietnam.

So would you please tell us in detail what the requirements are?

Ambassador Michalak: I don’t know all the requirements in detail, but I can give you some general ideas.

The government of Vietnam formally applied for GSP status about a month and a half to two months ago. There was, I believe, a 60 day comment period which just recently ended. During this comment period we received a large number of comments, many of them supporting GSP for Vietnam, as well as many comments raising questions particularly about intellectual property right protection and the status of labor here in Vietnam.

When a country formally applies for GSP,that becomes part of a process. That process has several steps and it outlines some limitations on what the U.S. government can and cannot do. So I know we have had some discussions on GSP-related issues, but I also know that we cannot say oh, if you do this you’re guaranteed to get GSP. I don’t think that as part of the process we can do that. But we’ve had some general discussions on issues of concern and I think the government of Vietnam has a good idea of what the next steps are and we hope that we’ll be able to go forward with it.

The one issue you did not mention was market economy status. The Department of Commerce in the United States and the Ministry of Industry and Trade here in Vietnam are in the process of setting up a working group to continue consultations on that issue.

On education, I already mentioned that we agreed to set up a Vietnam-U.S. Task Force on Education. We are in the process of selecting the members of that task force now and I hope within the next couple of weeks we may be able to have an announcement on the members and we can begin our work.

During the visit we also had a roundtable with the Prime Minister and about 15 different colleges and universities to discuss ways of furthering educational cooperation with Vietnam. Those discussions created linkages that we believe mean more discussions and more relationships that will be formed in the future.

On climate change, we agreed to set up a working group under the umbrella Science and Technology Agreement that we have with Vietnam to look at climate change issues. This is a very interesting issue. It turns out that the Mekong Delta which is likely to be one of the first areas of Vietnam that will be affected by climate change is very close in terms of ecology to the Mississippi Delta in the United States. We have an institute that studies the ecology and climate change in the Mississippi Delta. As part of the Climate Change Working Group, that institute in the United States will set up and institute at Can Tho University down in the Delta to organize projects that will look at climate change and will look particularly at the similarity between the Mississippi Delta and the Mekong Delta.

We’ll also be looking at projects on improved weather forecasting, remote sensing, disaster management and other issues related to climate change.

Question: I’m from BBC.

I just wonder whether you can say anything about oil exploration in Vietnam. Exxon Mobil is under pressure from China to stop a project in the South China Sea. Please make some comments on that.

Also, please tell us about the timeframe of the new embassy. Thank you.

Ambassador Michalak: We certainly don’t like anybody interfering in commercial operations of companies that are trying to carry out their commercial contracts, and I think it’s up to the companies to decide where they would like to work and with whom they would like to work. Some of our companies are as big as small countries themselves, so we pretty much leave it up to them where they want to work.

As to the embassy, first we’ve got to buy the land. We’ve been talking for several years on buying the land. I hope we will settle the land issue soon, before the end of the year. You can quote me on that. [Laughter].

After that it will just depend pretty much on budget cycles in the U.S. as to when we’ll have the money to be able to actually do the construction. But having the land is really important. Once that’s done the embassy follows usually within two to five years after that.

Question: My question, I’m from People’s Army Newspaper.

My question is after many high level visits by Vietnamese officials to the U.S. will there be a high level visit from the U.S. to Vietnam?

Ambassador Michalak: It’s hard to answer that question since first of all, we’re not sure who the highest level person will be in another month or two. We’ll just have to wait and see. The next high level meeting will actually take place at the APEC meetings in Peru. President Bush and President Triet will have an opportunity to meet there. Then there will be another opportunity to meet in New York when all of the leaders show up for the United Nations General Assembly. But when the next high level visitor comes to Vietnam, it’s hard to say. What do you think? Do you think Obama will come? Do you think McCain will come?

I don’t know if it’s true or not but I’ve heard rumors that both candidates have said they’re very interested in Vietnam. So my hope is that whoever wins, we’ll do our best to try and get them to come to Vietnam very early. That will be a task for my second year in office.

Question: I’m from Kyodo News.

How well is Vietnam’s economy at the moment?

Ambassador Michalak: I was wondering when someone was going to ask that question.

I think that as Vietnam continues to integrate into the world economy, it is going to feel some of the effects of the world economy. Global inflation has come to Vietnam. There was also some excess credit creation in 2007 that also was a big driver of inflation here in Vietnam.

I believe the response of the government to the inflation and the downturn in the economy has been very good. By response, I mean not only did the government consult within itself and have very intensive discussions within the government on how to resolve the economic problems, but they also went outside the government. They went to many economic experts all over the world to try to get advice on which policy moves would be the best to make because this is the first time that Vietnam has faced problems of this size.

I want to emphasize, it’s still too early to tell if all of the measures are going to be successful, but so far the numbers are looking pretty good.

The message now I think to the government of Vietnam is to stay the course. You’ve got a good program in place, keep it in place for at least another two, possibly three quarters. When the numbers begin to look a little bit better there’s all kinds of pressure to say okay, let’s get rid of all these measures, let’s lower the interest rates, let’s start spending money again. Most of the experts that I’ve talked to think it’s way too early to change course. Right now the programs in place are good but they have to stay in place for a long time to make sure that inflation gets under control.

So I guess the answer to the question about the economy is that it looks like the government is doing the right thing but they have to do it for a longer period of time to see if it really is going to take hold.

Question: I’m from Info TV under Vietnam Television.

The U.S. government has a very open policy regarding help for poor people so that they can buy houses, but it seems that this policy is also the one that led to the problems in the U.S. economy now. Do you think that the U.S. government has had a bad policy?

And what is the lesson for Vietnam through this? Although I understand that the Vietnamese land market, property market and the U.S. property markets are very different from each other.

Ambassador Michalak: Yeah, I’d say the property markets are quite a bit different between the U.S. and Vietnam. But I don’t think it’s fair to say that the U.S. programs for the poor were the cause of the current problems. I don’t believe that’s true.

I think the programs that the U.S. has for public housing, for housing for the poor, take into account that the people are poor. There is a very low expectation of being repaid for those loans.

The problem came when people made loans expecting to be repaid and did not really do the kind of credit checks that one normally does to make sure that people can repay the loans.

I’m sure there are lots of lessons to be learned from the current situation and I hope that at some point Vietnam will set up a system of mortgages which will try to make it easier for people to own their own home. When Vietnam is ready to do that then yes, I would definitely go and talk to the people at the U.S. Treasury and the U.S. Federal Reserve and Fannie Mae and Freddy Mac. I’m sure they will have lots of lessons learned to tell you. If they’re around. [Laughter].

Thanks - it’s been a great time. Thank you so much for helping me celebrate my first year anniversary here.

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