Senate backs Vietnam trade pact

Trade between Vietnam and the US might double

The United States Senate has approved an agreement normalising trade relations with America's former enemy, Vietnam.

Senators voted 88 to 12 in favour of the move, which was negotiated by the Clinton administration last year.

America has moved on, as has Vietnam

Senator John McCain

The move is the culmination of a 10-year reconciliation process between the two countries, which only established formal relations in 1995.

Last month, the House of Representatives gave its backing to the agreement, which will now go to President Bush to be signed into law.

Senate Finance Committee chairman Senator Max Baucus said the vote "represents an important step in the healing process, a step that has been a long time coming".

Clinton's role

The US and Vietnam fought a costly war in the 1960s and 1970s, which ended in a humiliating defeat for America.

The trade embargo against Vietnam was only lifted by President Clinton in 1994.

President Clinton lifted the trade embargo in 1994

With a population of 80 million, Vietnam is the world's 14th most populous nation, but trade with the US was only $1.2bn last year.

Analysts say that could more than double with normal trade relations.

President Bush strongly backs the deal but some legislators say Vietnam has not fully co-operated on the issue of missing US servicemen and should not benefit from a trade pact with the US.

"We should expect Vietnam to improve its record of human rights if we're going to trade with them," said Senator Bob Smith, a New Hampshire Republican.

Under current terms of trade, Vietnamese imports to America are subject to tariffs of 40%, more than 10 times the level imposed on most other countries.

Under the deal, both countries will lower trade tariffs, while Vietnam will open its markets to American service and investment companies.

But, as a communist country, Vietnam's normal trade status will be subject to annual review.