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Cablegate: Singapore Prime Minister Reaffirms Strong

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 02 HANOI 000593

SIPDIS

SENSITIVE

STATE FOR EAP/BCLTV; EAP/PMBS

E.O. 12958: N/A
TAGS: PREL PTER PGOV ETRD IZ SN VM ASEAN
SUBJECT: SINGAPORE PRIME MINISTER REAFFIRMS STRONG
-- ECONOMIC RELATIONSHIP

1. (SBU) SUMMARY. Singapore Prime Minister Goh Chok Tong
underscored a shared determination to advance the already
strong economic ties with Vietnam. PM Goh encouraged his
hosts to "look beyond Singapore" for future trade and
investment partners, however. Both sides reaffirmed a
commitment to counterterrorism and Vietnam reiterated its
hope for a peaceful solution to the Iraq situation. END
SUMMARY.

2. (U) PM Goh Chok Tong visited Vietnam March 3-5 at the
invitation of GVN Prime Minister Phan Van Khai. This was PM
Goh's third visit to Vietnam since 1994; he was last here in
1998 for the ASEAN summit. Singapore Embassy First
Secretary Andrew Teng told poloff on March 10 that PMs Goh

SIPDIS
and Khai "know each other well" from bilateral visits as
well as their attendance at various regional and
multilateral fora. PM Goh's visit was the most senior from
Singapore since President S.R. Nathan visited in February
2001; President Tran Duc Luong visited Singapore in 1998.

-----------------------------
VISIT CONSIDERED "UNOFFICIAL"
-----------------------------

3. (SBU) Although not described as such in the state-
controlled media (which reported prominently about the
visit), Teng said that the Singaporeans considered the visit
a "working, unofficial visit." Singapore authorities only
informed the GVN "about a week" in advance, although there
had been an invitation on record for a "considerable time,"
he added. Teng suggested that PM Goh, who already had a
trip planned to Thailand, liked the idea of also adding
Vietnam. However, PM Goh apparently preferred not to have
the "ceremonial trappings" of a full-blown state visit.
According to Teng, the GVN "was not thrilled" with the idea,
but went along with it, probably, in part, due to
Singapore's importance as a foreign investor. Due to the
unofficial nature of the trip, Teng noted that there was no
large entourage of government and business officials and no
agreements were signed.

4. (U) Despite the relatively short notice, PM Goh met
with Vietnam's three major leaders: PM Khai, President
Luong, and Communist Party of Vietnam General Secretary Nong
Duc Manh. In addition, PM Goh also met with resident
Singapore businessmen and paid a visit to the Singapore-
sponsored training center in Hanoi.

--------------------------------------------- ---
ECONOMICS: VIETNAM SHOULD LOOK BEYOND SINGAPORE
--------------------------------------------- ---

5. (U) According to press reports, Singapore is the
largest foreign investor in Vietnam, totaling over USD 7.2
billion spread over 320 projects. Teng cautioned against
reading too much into this figure, however. While
undoubtedly Singapore is a "major economic force in
Vietnam," probably "about 50 percent" of the foreign
investment credited to Singapore is actually third party
investment that goes through Singapore (Note: including at
least USD 1 billion from US companies based in Singapore,
according to Embassy Hanoi's estimate). Two-way trade is
also significant, having reached about USD 3.5 billion in
2002.

6. (SBU) According to Teng, PM Goh told his hosts that if
Vietnam wanted to move to the next stage of economic
development, it should "actually look beyond" Singapore and
other ASEAN countries and focus its efforts on large markets
such as the European Union and the United States. PM Goh
told the GVN leadership that while ASEAN will no doubt
remain an important market for Vietnam, the "long term
future" is in the West. Separately, Dr. Tran Khanh,
Director of the Center for ASEAN Studies, Institute of
Southeast Asian Studies, told poloff on March 11 that this
message "is not new" to the GVN. "Our leaders know that we
will have to look beyond ASEAN truly to compete in this era
of globalization," he added.

--------------------------------------------- --
SINGAPORE BUSINESS COMMUNITY: GENERALLY UPBEAT
--------------------------------------------- --

7. (U) Teng noted that when PM Goh met with the local
Singapore business community, they were generally upbeat on
the business climate in Vietnam. Many have been here close
to 10 years, he added, and "know their way around."
However, several suggested to PM Goh that he remind his
hosts of the need for faster economic reforms. Some also
expressed frustration at what they termed "poor policy
coordination" among ministries involved with the business
community. On the positive side, business leaders told PM
Goh that they believe there is good potential in Vietnam for
tourism and real estate ventures, including hotels and
residential facilities.
--------------------------------
SINGAPORE TRAINING WELL RECEIVED
--------------------------------

8. (SBU) At his visit to the Singapore-sponsored training
facility in central Hanoi, PM Goh had a "lively discussion"
with the Vietnamese students. This was his only substantial
contact with the public during the visit, Teng noted.
Nearly 400 Vietnamese students have received short-term
training at the center in a wide variety of fields. The
center, according to Teng, can be viewed as Singapore's
contribution to the ongoing ASEAN effort of encouraging
wealthier nations to help the less developed. During the
visit, PM Goh also discussed with Vietnam's leadership the
possibility that Singapore would sponsor more student
exchanges. Teng said that the GVN leaders viewed this idea
positively.

--------------------------------
POLITICAL ISSUES: NOT BILATERAL
--------------------------------

9. (SBU) Teng and Khanh said separately that, while
Singapore and Vietnam have no outstanding bilateral
political issues, PM Goh and Party Secretary Manh touched on
terrorism, with Manh claiming that Vietnam is "sympathetic"
to counterterrorism needs because of its "past experience."
Teng expressed some puzzlement about Manh's exact meaning
but suggested that Manh might have been making an oblique
reference to past "terrorist" incidents perpetrated against
Vietnam by overseas Vietnamese. Khanh commented that, since
terrorism is "an extremely sensitive issue in Singapore,"
the leaders likely had no desire to go beyond a very limited
discussion. Regarding Iraq, Teng said that the topic came
up in the meeting with PM Khai, who repeated the standard
GVN line about Vietnam's desire for a peaceful solution and
the need to work within the UN framework.

------------
WHAT'S NEXT?
------------

10. (SBU) Teng said that PM Goh would return to Vietnam in
2004, when Vietnam hosts the next ASEM meeting. PM Goh also
invited PM Khai to Singapore. Teng added that PM Khai
"happily accepted" but no dates have been fixed.
PORTER

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