SPENCER MICHELS: The bustle and boom is everywhere in the streets of Ho Chi Minh City, the former Saigon, some 30 years after the Vietnam War ended. The Communist state that's home to 80 million people is now one of the fastest-growing economies in the world. It's moving toward a market economy and toward a gradual reconciliation with the U.S. In 2000, President Clinton paid an historic visit to Vietnam near the end of his term in office, the first visit of a U.S. president since the war. Five years before, he'd restored full diplomatic relations with Vietnam.
This time it was Vietnamese Prime Minister Phan Van Khai's turn to visit the United States. Trade issues and membership in the World Trade Organization were at the top of his agenda. Khai's first stop was in Seattle, Washington, where he toured a Boeing plant. Vietnam will buy four of the new 787 Dreamliner planes. He also met with Microsoft Chairman Bill Gates.
PHAN VAN KHAI (translated): Our success in the future will be a tribute to you, Mr. Bill Gates.
SPENCER MICHELS: Protests followed the prime minister wherever he went, outside both his meetings in Seattle. And in Washington, D.C., today, as his limousine pulled up the circular drive to the White House, the shouts of demonstrators, mainly Vietnamese Americans, from across the street were loud. They yelled "Communist, go home," and protested government policies that stifle press freedom, jail opponents and limit some religious practices.
But inside the West Wing, President Bush welcomed Prime Minister Khai, the first Vietnamese prime minister to have an Oval Office session since the end of the Vietnam War.
PRESIDENT GEORGE W. BUSH: The prime minister graciously invited me to Vietnam. I will be going in 2006. I'm looking forward to my trip, also looking forward to the APEC summit that Vietnam will be hosting.
SPENCER MICHELS: Prime Minister Khai acknowledged differences between the two nations remain, but pushed for increased economic ties.
PHAN VAN KAHI (translated): We believe that America can find in Vietnam a potential cooperation partner. We have a population of 80 million people, which means a huge market for American businesses. And these people are also very hardworking, creative and dynamic, and they are now working very hard to achieve the goal of building Vietnam into a strong country with wealthy people and a democratic and advanced society.
SPENCER MICHELS: The president hailed a recent Vietnamese promise to expand religious freedom, and he encouraged further Vietnamese progress on human rights.
RAY SUAREZ: And Margaret Warner has more.
MARGARET WARNER: For more on today's visit and the importance of the relationship for both Vietnam and the United States, we turn to Raymond Burghardt, former U.S. ambassador to Vietnam from 2001 to 2004. He's now director of seminars at the East-West Center, an independent education and research group based in Honolulu. And Nayan Chanda, director of publications at the Yale Center for the Study of Globalization. He's the former editor of the Far Eastern Economic Review, and he reported from Saigon at the end of the Vietnam War. Welcome to you both.
Ambassador Burghardt, what is the significance of today's visit for both Vietnam and the United States?
RAYMOND BURGHARDT: Well, we've had diplomatic relations for 10 years. They've developed relatively slowly, picking up speed in the last couple of years. This is the first time a Vietnamese prime minister has visited Vietnam since the war.
MARGARET WARNER: You mean the U.S.?
RAYMOND BURGHARDT: Yes, visited the United States since the war. And it's really a reciprocal visit, a return visit for President Clinton's trip to Vietnam in November 2000.
MARGARET WARNER: And has there been a tremendous evolution in the relationship in those 10 years; if so, in what way?
RAYMOND BURGHARDT: Well, we began dealing with the issues left over from the war: Accounting for MIAs, reuniting families of both people. Then we developed strong economic relations, which have increased quite dramatically in the last few years. And now we're starting to develop broader relations. One of the things that was very significant in the last three years was developing even ties between our militaries, including three naval...U.S. Naval ships visiting Vietnam in the last two years.
MARGARET WARNER: Nayan Chanda, what does Vietnam...first of all, what has Vietnam gotten out of this relationship in these 10 years? What's the most important thing? And what more does it want from the U.S. and from the relationship?
NAYAN CHANDA: First of all, I think for the Vietnamese, it was a huge deal to finally have the recognition of the United States. They fought a long, bitter war, but it took a long time to get the diplomatic relationship established. And once that is done, they have been benefiting enormously from the trade relationship with the United States.
MARGARET WARNER: Go ahead. Give us a little more on that. You mean is it really helped Vietnam's economic development to have this trade relationship? And if so, how much...for instance, today they were talking about Vietnam wants early session into the WTO. How important is the U.S. in that?
NAYAN CHANDA: First of all, the U.S.-Vietnam trade agreement, which was signed in 2001, has opened the U.S. market for the Vietnamese goods which was prohibitively tariffed before. So the Vietnamese are actually exporting a significant amount to the United States.
The United States has emerged as the most important trading partner of the Vietnamese. So that is very important. And the Vietnamese, of course, want the U.S. help to join the WTO. And President Bush today has said that U.S. strongly supports Vietnam's entry into the WTO.
MARGARET WARNER: Ambassador, what is the geopolitical significance of this relationship for each country?
RAYMOND BURGHARDT: I think for both...both countries see the relationship as helpful in maintaining a balance in Southeast Asia. The Vietnamese told me...they told us when I was there that while the relationship with China had developed very well, they saw China's increased influence in Asia as something that needed to be kept in balance. And they saw the U.S. as critical for that.
And for the U.S., I mean, we're not trying to contain China. That would be a futile cause, but we do see the need for balance. I mean, China's influence is increasing, and it's good to have friends in Southeast Asia who are large countries, growing countries, and to help to maintain that kind of security there.
MARGARET WARNER: Nayan Chanda, do you see it that way, that for both countries this represents a way of keeping some balance, power balance in Asia?
NAYAN CHANDA: Indeed, it is, indeed. Because if you look at the joint statement put out by the White House and the Vietnamese prime minister today, the significant thread there is that Vietnam and the United States want to have a partnership in maintaining peace and security and prosperity in Southeast Asia and Asia Pacific. And this Asia Pacific reference I think is very significant, because it basically means China -- that the United States has an interest in having a good relationship with Vietnam as a counterbalance to China, not necessarily militarily, but politically.
MARGARET WARNER: And how do think, Mr. Chanda, that this visit, for instance, is regarded in Beijing?
NAYAN CHANDA: I think the Viet -- Chinese reaction publicly would be very muted, but the Chinese would be watching very carefully, because they have obviously been reading reports about the U.S. naval ship visits to Vietnam. And the fact that now this trip, the Vietnamese and the U.S. have agreed to establish a military training program, as well as the intelligence sharing in fighting the terrorist threat. These cooperations are viewed with some suspicion in Beijing.
MARGARET WARNER: Mr. Ambassador, Amnesty International and many other human rights groups, Human Rights Watch, have been...are very critical of Vietnam and the state of human rights there. What is the state of political freedom in Vietnam?
RAYMOND BURGHARDT: Well, Vietnam is one of the world's last five Leninist countries, one of the last five countries ruled by a Communist Party as a one-party state. It's a country where there's been progress in the last 10 or 15 years. People have more control of their lives now than they did before.
The private sector is bigger. Not everybody works for the government. The government doesn't have that kind of...that kind of leverage over people's lives that it had 10 or 15 years ago. But still, by standards of a western democracy, or even an Asian democracy, Vietnam is a country where if you advocate a multiparty system, you'll end up in jail. It's a country where people are generally free to worship as they want, but churches are organizations that the state keeps pretty tight control over.
MARGARET WARNER: So it's been compared, for instance, to China in the degree of political freedom that it's still pretty much one-party rule. Would you agree with that?
RAYMOND BURGHARDT: Vietnam -- the political system in Vietnam is actually very similar to China. Like China, it's a country where the political bureau of the Communist Party maintains the final word on all issues.
MARGARET WARNER: And Mr. Chanda, how about the economic system? How open is it? I mean, how many people are free to be entrepreneurs and do what they want to do, versus...and how much of it is still state-controlled?
NAYAN CHANDA: Well, the state control has diminished considerably, beginning with agriculture, which was privatized. Peasants now own their land and do whatever they want to do with that land.
In terms of industry, the state sector has been progressively diminished, and, in fact, Vietnam today employs only 10 percent of its labor force in the state sector, so 90 percent is employed by the private sector. And the private sector is increasingly given more freedom to actually set up businesses as well as go into joint venture with foreign investors.
RAYMOND BURGHARDT: Margaret, can I answer that?
MARGARET WARNER: Please do, yes.
RAYMOND BURGHARDT: I think one of the key realizations of the Vietnamese leadership in the last few years was that they needed to develop the private sector. They needed to welcome foreign investment, foreign companies setting up factories and operations there, in order to employ their people. They had a big baby boom in the years after the Vietnam War. They need to... they have lots of people leaving the countryside, going to the cities. So they need to create one and a half to two million new jobs a year, and the state sector is not going to do it.
MARGARET WARNER: All right, Mr. Ambassador, Nayan Chanda, thank you, both.
RAYMOND BURGHARDT: Thank you, Margaret.
NAYAN CHANDA: Thank you.