Moderator: Good morning, everyone. My name is Jim Hock the head of public affairs for the Department of Commerce. Thank you for joining us this morning.
Secretary Pritzker will make some opening comments and then take a few questions. We’d ask that you please identify yourself before you ask your question. We’re also doing dual translation, so we may have to stop and slow down at some point as well.
I want to take a moment just to thank Spencer Cryder and our embassy team here for all their help. With that, I’ll turn it over to Secretary Pritzker, the 38th U.S. Commerce Secretary.
Secretary Pritzker: Thank you very much. It’s a pleasure to be in Vietnam, a country the United States views as a critical partner in the ASEAN region. We value our relationship with Vietnam and appreciate the warm welcome that we’ve received by the people and by your businesses.
I am back here in Asia because the Obama administration is firmly committed to deepening U.S. engagement with both Vietnam and the ASEAN region with which we share many common bonds.
As U.S. Commerce Secretary I’m particularly focused on how we can strengthen our partnership on the economic front. Like many of the ASEAN countries, the Vietnamese market offers significant potential for U.S. businesses to collaborate on mutually beneficial growth opportunities. We support a strong, prosperous Vietnam in which foreign countries can invest.
The 20th anniversary of U.S.-Vietnam relations is a great occasion to mark the growth in our two-way trade which has grown 15-fold in the past 20 years. In 1994 our two countries normalized trade relations. In that year bilateral trade totaled only $223 million. Today that number stands at $30 billion, which is a remarkable achievement.
Vietnam has experienced strong economic growth in recent years which is expected to continue. We are seeing more diversification in Vietnam’s economy which is a good thing. And while the trade relationship between the United States and Vietnam is strong, we can do more.
U.S. exports to Vietnam totaled $5 billion in 2013, an increase of over 8 percent from the previous year; and imports to the U.S. from Vietnam totaled $24.6 billion in 2013, an increase of 21.6 percent from 2012. So the time now is for the Vietnamese to buy more from their friends.
One of the ways that we’ll increase prosperity is through the successful conclusion of the Trans-Pacific Partnership which will be transformative. TPP will expand trade and investment among the 12 members, serve as a platform for broader regional integration in the Asia Pacific, and be a catalyst for advancing trade liberalization globally.
Vietnam in particular has much to gain from the completion of TPP. Vietnam will see the greatest rate of increase in exports estimated to be about 32 percent and GDP up by 25 percent once the TPP agreement is fully implemented. This is according to the Peterson Institute.
TPP will benefit all the participating economies, which is why we are so eager to overcome the outstanding issues in the negotiation. This is a trade deal that is good for both of our countries.
At the same time this trip is another way to deepen the partnership between our governments and our businesses. It demonstrates the importance of both Vietnam and the region to the Obama administration and the U.S. business community. As well, our shared commitment to increasing U.S. commercial activity with ASEAN.
On this trip I’m here with the U.S. ASEAN Business Council and some of America’s top business leaders because the U.S. government and our business community are committed to increasing mutually beneficial two-way trade and investment and fostering a business climate that creates prosperity for all.
So while on this trip in each country the Commerce Department and the U.S. ASEAN Business Council are participating in meetings with key government officials and business leaders. We are discussing how each country can continue developing a fair and open business climate and the importance of reducing market access barriers and how increasing transparency will lead to long term and sustained development.
The economic goal of the U.S. rebalance to Asia, achieving long-term shared prosperity across the Asia Pacific region and home, demands much more than simply selling American products to new customers. The fact is the U.S. business can help create shared prosperity and deepen the economic connection that increase opportunity for us all.
American businesses have the know-how to help dynamic, fast-growing and emerging Asian economies to enter into the global rules-based trade and investment system by developing the necessary infrastructure, both hard and soft. By hard I mean U.S. business can help develop physical infrastructure that’s necessary to move goods, services and people from Point A to Point B smoothly. And by soft I mean the legal and regulatory systems that provide clarity and predictability to transactions.
The bottom line is American business and the U.S. government want to be part of the solution as Vietnam and countries across the region look to grow and prosper, benefiting all the people of the ASEAN region.
So I’m pleased to be here and I’m happy to take your questions.
Moderator: Our first question will come from our Vietnamese friends, VTV1
Press: [Through Interpreter]. Ms. Thu from VTV1. She has two questions.
The first one, do you think this is the best time to enhance the commercial relationship with the U.S., and why?
Secretary Pritzker: I think from a timing standpoint, given the fact that we’re nearing the end of negotiations of the TPP Agreement, and given the fact that our American businesses have tremendous interest in doing business here, now is the perfect time for us to be more and more engaged and to continue to build the foundation on which we can grow our two-way trade.
Moderator: Our next question will come from Chris Brummitt from AP.
Press: China’s recent actions have not won it many friends in the region. Do you think now is a good opportunity for America to sell itself as a dependable business partner? Are there opportunities now in the wake of what’s been happening?
Secretary Pritzker: I think now is an absolutely good time for American businesses to continue investing and for new businesses to explore investing here in Vietnam. The Vietnamese are encouraging us and Vietnam offers a significant potential for U.S. businesses to collaborate, so I see this as a wonderful time. And what I’ve learned from the American businesses that I’ve talked to who are present here, whatever the ups and downs are of various economies around the ASEAN region, they are here to stay for the long haul and they’re committed and see the opportunity to work collaboratively with various governments, whether it’s Vietnam or the other ASEAN economies. And frankly, this trip is really evidence of the importance of those relationships, particularly here in Vietnam but as well as the other ASEAN countries.
Moderator: Our next question will come from Ms. Giang, Tuoi Tre.
Press: Thank you. I just have a couple of short questions.
The first one related to the meetings with Vietnamese leaders, as far as I heard, correct me if I’m wrong, that the meeting lasted longer than it was scheduled at the beginning, like a 15 minute meeting turned out to be a 30 minute meeting.
Secondly, does the ongoing tension in the East Sea, the South China Sea, influence U.S. investors perception of the business environment between Vietnam and China?
Secretary Pritzker: The leader meetings that we have are meetings with both the President, the Prime Minister, as well as the Minister of Trade and Industry. I’m very much looking forward to all of those conversations. There’s much for us to cover, so we’re taking the time that’s necessary to cover the various topics because we see a real opportunity to deepen our economic relationship.
Vis-à-vis the South China Sea and its impact on investors’ attitudes, there has been some impact on business but what I am not seeing is it having an impact on the interest of American business in being present here in Vietnam and throughout the ASEAN region. They want to have a greater engagement here as well as throughout the region.
Moderator: Our next question will come from John Boudreau from Bloomberg.
Press: Welcome to Hanoi.
Secretary Pritzker: Thank you.
Press: There’s been concern among some officials in the government that the repercussions of the dispute with China in the South China Sea could result in economic retaliation from China in Vietnam. I was wondering if you had some thoughts on that, and whether there would be any response from the U.S. to that?
Secretary Pritzker: Look, China’s decision to introduce an oil rig accompanied by the numerous vessels in the waters disputed with Vietnam is provocative and it does raise tension. We’re very concerned about the dangerous conduct and the intimidation by the vessels operating in this area. But the United States has a national interest in the maintenance of peace and stability and the respect for international law as well as unimpeded lawful commerce including the freedom of navigation overflights through the South China Sea.
So the United States supports the use of diplomatic efforts and other peaceful means to manage and solve the disputes in the South China Sea including the use of arbitration or other international legal mechanisms.
As I said earlier, to date this is not impacting the attitude of American business in terms of their desire to be present and they very much have appreciated how the Vietnamese government has handled the situation to date.
Moderator: Our next question, Ms. Viet Anh, VnExpress.
Press: I want to follow the idea from my colleague related to the South China Sea. If China does not change their action now in South China Sea, how do you worry about the trade flow in the South China Sea?
Secretary Pritzker: I think that in terms of American businesses, as I said, there is commitment to staying present here, and in fact to looking for additional opportunities because the view is there’s a long-term opportunity in the ASEAN region. If you look at the 600 million people, the growing economies, the growing middle class, and the need for various technologies that can assist the countries in developing into the kind of prosperous economies that they’d like to be, whether it’s in power, or in tourism, or in technology, or in insurance or financial services products. So there’s a broader demand for American goods and services. So I see American businesses not — I see them embracing the opportunity as opposed to shrinking from the situation.
Moderator: We have time for two more questions. Our next question will be from Reuters.
Press: Good morning, I’m Linh from Reuters. I would like to ask in the previous meeting of the Vietnam Prime Minister and U.S. leaders, the Prime Minister mentioned that he would like to ask for more flexible rules from the U.S. on trusting Vietnam as only in TPP negotiations. Can you please tell us more details on what the flexible rules that the PM asked?
The second question is what is the most complicated issue for Vietnam from your point of view in TPP negotiations? Thank you.
Secretary Pritzker: Can you just repeat the second question?
Press: What is Vietnam’s most complicated issue in TPP negotiations?
Secretary Pritzker: I think one of the things that we learned from the Peterson Institute study is that Vietnam has an enormous amount to gain from the completion of the TPP Agreement with the other 12 nations. As I said before, an increase in exports of about 32 percent and GDP by 25 percent.
But completing a deal on so many different issues is in itself probably the most complicated part of the negotiation. If you think about trying to get 12 nations to come together as well as on so many issues. But what’s so important about this agreement is the fact that it’s going to set a 21st Century standard for how trade should occur with 40 percent of the world’s GDP.
What we know for every country participating in TPP is that they will benefit from completion of this agreement. But what it requires of every country that will participate is adapting to higher standards of the way one does business. For all 12 countries. So whether it’s Vietnam addressing the state-owned enterprise issue of labor issues versus the United States addressing different questions regarding particular sectors, or all the countries dealing with market access, the ambition of TPP is to create greater trade among the countries that are participating and set a standard for how trade should be done in the 21st Century.
Moderator: This will be our last question. Ms. Linh, VietnamNet.
Press: [Through Interpreter]. The reporter from VietnamNet, she said you mentioned a lot about the benefits for U.S. companies and Vietnamese companies and how the companies or other countries through the TPP. But it seems to our understanding that the result of the recent negotiation is not very promising. So we are concerned that such kind of slow progress, the recent negotiations of the TPP may reduce the motivation for the member countries. We are concerned that such kind of reduction in motivation of the countries to the TPP might result in a delay of the finalization of the negotiation and take another year for the completion. So could you tell us about this?
And she said because of some requirement from the U.S. might lead to the further delay of the finalization of the agreement.
Secretary Pritzker: Let me be clear. There is no shortage of motivation to get this deal done. On anyone’s part. It is complex, though. We’re at the end of the negotiation. And in any negotiation towards the end it’s the harder things that have to be dealt with. But I can assure you that there is progress being made. I think the next round of negotiation will occur in the next 30 days as I understand, and that the last round which was hosted here in Vietnam did lead to progress that has led to an enormous amount of work that’s going on right now behind the scenes. But it’s going to — I think, make no mistake. We’re at the end of the negotiation and this is the hard part. So it could take some time but there is no shortage of commitment. And particularly we’ve seen commitment by the Vietnamese leadership and we appreciate the progress that’s being made there.
Moderator: Ladies and gentlemen, thank you so much for coming. If there are any follow-up questions please direct them to Spencer and we’ll get back to you as quickly as possible. Thank you again.
Secretary Pritzker: Thank you.