Israel to sign landmark trade deal with Cold War critic Vietnam

Published April 1st, 2001 - 02:00 GMT

After years of Cold War enmity, Israel is poised to seal the normalization of relations with communist Vietnam through the signing of a trade accord within the next few months, embassy officials said Friday, March 30. 


Following two years of negotiation, Israel hopes that a visit here by a high-ranking business delegation this week will give the final impetus to the signing of the landmark deal. "I hope that it is a matter of no more than a few months," said embassy spokesman Yahel Vilan, adding that he expected Trade Minister Valia Itzik to travel to Hanoi for the signing. 


During the visit by a delegation led by the influential chairman of the Israeli Producers' Association, Oded Tyrah, Vietnamese Prime Minister Phan Van Khai openly called for closer ties. 


Vilan said Israel's interests in a deal were more political than economic as communist Vietnam had long been a close ally of radical Arab states such as Iraq and Libya, and had only established diplomatic relations with the Jewish state in 1993. 


"We want to have it mainly from the political point of view ... We want to sign as part of normalizing relations between our two countries," he said. "I don't think that when we have it, trade will jump massively." 


Like most Eastern bloc countries, Vietnam pursued a strongly pro-Arab policy during the late 1970s and 1980s and imposed an economic boycott on the Jewish state. 


The communist authorities discreetly eased the embargo during the 1990s and have since moved towards a more equivocal policy towards the Middle East conflict in a bid to woo greater Israeli investment for their impoverished economy. 


Vilan welcomed the absence of condemnation from Vietnam of Israel's handling of the renewed Palestinian uprising of recent months. "It has been better even than what we have had from some European countries. In terms of public policy it has been quite reasonable, quite fair." Vilan said that ironically it was now Vietnam that was pressing hardest for the rapprochement. 


In the mid-1990s Israel's finance, telecommunications and agriculture ministers had all traveled here but there had been no ministerial visits since. By contrast Deputy Prime Minister Nguyen Cong Tan had visited Israel in November 1999 and two high-ranking business delegations had followed last year. 


"It seems that in the past few years they have suddenly understood that they can get much more from Israel than they used to. They want to bring software companies and hi-tech here." Vilan said Israel accepted that its annual trade with Vietnam would continue to pale in comparison with the hundreds of million of dollars of business that Vietnam does with Iraq. 


Bilateral trade reached a peak of round $38 million in 1999 before falling to a little over $20 million last year. Israel attributes most of the fall to a drop in Vietnamese imports of Israeli fertilizers following a worldwide slump in commodity prices. 


Vilan said Vietnam was keen to export labor to the Jewish state as some other Asian countries, particularly Thailand, had done in recent years. "But this is not something that Israel would be able to approve in the coming time." 


An influx of Asian and east European laborers in the 1990s to replace Palestinians shut out by closures on the occupied territories has sparked mounting protests from Orthodox Jews in recent years. 


Vietnam still recognizes Palestinian statehood and the Palestine Liberation Organization maintains an embassy here. But when Palestinian leader Yasser Arafat traveled here for his 10th visit early last year, the communist authorities urged him to hold off plans to declare a Palestinian state in the occupied territories without a prior agreement with Israel. — (AFP, Hanoi) 


© Agence France Presse 2001

© 2001 Mena Report (

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