US embassy cable - 03HOCHIMINHCITY1100

UNCLAS SECTION 01 OF 04 HO CHI MINH CITY 001100 
 
SIPDIS 
 
SENSITIVE 
 
DEPARTMENT FOR EAP/BCLTV, DRL 
 
E. O. 12958: N/A 
TAGS: PHUM, ECON, PGOV, PREL, EINV, ETRD, SOCI, KIRF, VM, RELFREE, HUMANR, ETMIN 
SUBJECT: BALANCING ETHNIC AND RELIGIOUS DIVERSITY IN SOC TRANG AND 
TRA VINH 
 
1. (SBU) Summary:  DCM (then Charge) and ConGen Poloff visited Soc 
Trang and Tra Vinh Provinces during October 1-3, to examine 
firsthand the situation for the ethnic Khmer in the Mekong Delta, 
in light of continuing reports of discrimination from sources 
overseas.  Situated in an area that once belonged to Cambodia, 
these two coastal provinces have large Khmer populations.  But 
while these are both relatively poor, underdeveloped provinces, 
the ethnic Khmer seem to be faring no worse than anyone else. 
Both provinces depend heavily on wet rice agriculture and 
aquaculture, but are hoping to diversify if infrastructure can be 
improved.  During his trip, the DCM had an opportunity to speak 
with provincial officials, Buddhist, Protestant and Catholic 
leaders, local businessmen, and ordinary Khmer residents.  For 
their part, the officials seemed committed to sharing any new 
wealth fairly among the ethnic Khmer and the majority Vietnamese 
Kinh.  The Khmer, meanwhile, seemed well integrated and raised no 
allegations of ethnic strife.  The Khmer language and culture, 
including Khmer Buddhist practices, appeared to be flourishing. 
End summary. 
 
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JUST BELOW THE NATIONAL AVERAGE 
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2. (U) Soc Trang covers an area of just over 3200 square 
kilometers, including 72 kilometers of coastline.  Ethnic Khmer 
number 340,000 (28 percent) out of a total population of 1.2 
million.  There are also 65,000 ethnic Chinese.  Just up the 
coast, Tra Vinh occupies a land area of 2228 square kilometers, 
with 65 kilometers of coastline.  The population of one million 
includes 300,000 (30 percent) ethnic Khmer.  Most Khmer in the two 
provinces are rice farmers, but some have begun to venture into 
more lucrative fields, such as shrimp farming and cattle raising. 
Of the two provincial capitals, Tra Vinh seemed the tidier, 
cleaner, and more prosperous town.  The town is well-known for its 
many old trees.  Roads in both provinces were narrow and often 
choked by even mild two-way traffic. 
 
3. (U) Agriculture and aquaculture account for over 50 percent of 
economic activity in the two provinces.  Soc Trang fares slightly 
better, with annual yields of 1.6 million tons of rice and 56,000 
tons of sea products.  Five local seafood-processing plants handle 
nearly 30,000 tons, with the remainder processed by individual 
farmers and fishermen for sale to exporters.  Four of the five are 
in private hands, including the largest, which processed over 
USD$80 million in sea products last year.  Soc Trang already ranks 
just behind Ca Mau as the largest seafood exporter in the country. 
Provincial leaders hope to expand shrimp farming from 48,000 to 
nearly 80,000 hectares over the next few years.  This would raise 
output to 72,000 tons (worth an estimated USD$480 million) by 
2005.  Having recognized the ecological shortcomings of flooding 
rice fields with saltwater to create shrimp ponds, local 
authorities are looking for more natural methods.  Overall 
economic growth in the province exceeded 8 percent last year. 
Annual per capita income was slightly lower than the national 
average, at USD$379. 
 
4. (U) Tra Vinh, meanwhile, produced 1.2 million tons of rice, but 
many local Khmer farmers are moving from rice to sugar cane and 
livestock.  Like its neighbor, Tra Vinh is trying to exploit its 
coastal location for aquaculture.  Unfortunately, Tra Vinh has 
only half as much available area for shrimp farming as Soc Trang, 
and is hampered by the constant tidal mixing of fresh, salty, and 
brackish water.  Despite those drawbacks, economic growth reached 
almost 10 percent last year, raising per capita incomes to just 
under USD$350 per year. 
 
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NO CAPITAL, NO FDI, AND NO WAY TO GET THERE FROM HERE 
--------------------------------------------- -------- 
5. (SBU) Despite this relative good fortune, the two provinces 
still have a long way to go to provide true economic opportunity 
and a decent standard of living to all their inhabitants.  Neither 
province currently has much to offer in the way of manufacturing 
or services, although both are eager to attract American 
investment, development assistance, and NGO activity.  Soc Trang 
People's Committee Chairman Huynh Thanh Hiep told DCM he had just 
submitted a proposal to the central government for a new 150 
hectare industrial park with deep water port facilities and was 
looking at ways to get funding for a new marketplace to revitalize 
the provincial capital's downtown commercial area.  The industrial 
park would host mostly food processors.  The deep water port, a 
floating transit point in the Dinh An Estuary, was expected to 
move 10,000 tons of freight.  Mr. Hiep said the American Chamber 
of Commerce in HCMC had recently referred one American investor 
for the project. 
 
6. (SBU) Chairman Hiep bemoaned the difficulties of mobilizing 
sufficient capital to achieve the desired level of growth, noting 
that the province received the equivalent of only USD$10 million 
per year from the national government.  Director Kien of the 
Department of Planning and Investment noted that Soc Trang was 
still at the stage of development where all available funds go 
immediately to upgrading infrastructure and improving the general 
welfare of the people.  He said Soc Trang's only foreign direct 
investment project was about to close down because the Taiwanese 
investor was unable to compete with similar factories in HCMC. 
Over dinner, Chairman Hiep acknowledged the good work of many 
international NGOs in the province, including some from the U.S. 
He hoped some benefit might flow to the province if airports in Ca 
Mau and Can Tho were to reopen.  He also thought Can Tho's pending 
reclassification as an independently administered city might 
spread the wealth to nearby Delta provinces like Soc Trang.  (Post 
Note:  Designation as a special administrative city -- Hanoi, 
HCMC, Danang, and Haiphong -- confers some degree of autonomy on a 
municipality in terms of taxes, budget priorities, land use, and 
project licensing approvals.  In essence, it makes the city a 
province in and of itself.  End note.) 
 
7. (SBU) Tra Vinh People's Committee Vice Chairman Tran Hoang Kim 
noted that industry represented only 10 percent of his province's 
economic output, centered mostly on food processing -- shrimp, 
coconut, and sugar cane.  Vice Chairman Kim (a three-time delegate 
to the National Assembly before the current session) is intent on 
locating garment and textile factories in Tra Vinh, but 
acknowledged serious problems with transporting raw materials and 
finished goods.  Even with three highways crisscrossing the 
province, waterborne transportation was still the only way to move 
large shipments.  Hong-Viet, a small joint venture with a Hong 
Kong company, just signed a contract with a larger HCMC firm and 
plans to expand from 600 to 2000 workers in the near future. 
Another private firm is expected to start producing garments by 
the end of this year. 
 
8. (SBU) Vice Chairman Kim said there had been little effect on 
his province from the Bilateral Trade Agreement with the U.S., 
even with the subsequent increase in the volume of trade.  He did 
think WTO accession would have a positive effect on Vietnam's 
exports, however, and was not worried about competition from 
foreign agricultural producers.  In the longer term, bridges 
spanning three of the "Nine Dragons" of the Mekong River, 
scheduled for completion in 2007 and 2008, would make the province 
more attractive to manufacturers.  Mr. Kim said he hoped 
Vietnamese-Americans with expertise in shrimp farming would view 
Tra Vinh as a good place to invest. 
 
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SEAFOOD PRODUCT PROCESSING AND SOLAR ENERGY 
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9. (SBU) In Tra Vinh, the DCM toured the high-tech shrimp 
processing line of the Cuu Long Sea Products Company.  Director 
Nguyen Van Bang -- a 1985 Can Tho University graduate, who joined 
the company a year later, and worked his way up through the ranks 
-- said the company had just begun shipping frozen seafood (mostly 
tiger shrimp) to the east and west coasts of the U.S. in 2000. 
Sixty percent of their product went to the U.S. in 2001, and 50 
percent in 2002.  Total turnover was up from USD$13 million in 
2001 to over USD$18 million in the first nine months of 2003.  Cuu 
Long employs 900 workers, including 100 Khmer.  The workers enjoy 
excellent working conditions, including wages at almost twice the 
provincial average, twice yearly medical examinations, and free 
lunches.  The company buys mostly from small fishermen and shrimp 
farmers.  This state-owned company is in the process of 
privatizing, and plans to hold its first shareholder conference in 
January 2004.  Looking toward expanding exports to Eastern Europe, 
Director Bang described the difficulties of having to truck his 
products to HCMC in freezer trucks for shipment. 
 
10. (SBU) The DCM also had an opportunity to travel to a remote 
Tra Vinh village with the regional representative of U.S.-based 
SELCO (Solar Electric Light Company).  The company, which also 
does business in India and Sri Lanka, targets customers not 
connected to the national power grid.  The company is still not 
profitable in Vietnam, with sales of only 1448 solar energy units 
over the past two years, but estimates show potentially 20 million 
families in Vietnam still relying on generator or battery power. 
The target market is families earning USD$70 per month, considered 
sufficient to pay the required USD$9 per month for financing. 
(Loans are arranged through the Bank for Agricultural 
Reconstruction and Development.  The default rate is approximately 
18 percent.)  One major obstacle to greater sales is that not many 
families can afford the USD$200 down payment on the USD$900 solar 
unit, at least not without help from their families overseas. 
Another problem is illegal wires strung from distant power lines 
to rural homes (in full view of the retinue of provincial 
officials who joined the DCM for the tour), which obviate the need 
to purchase a SELCO unit.  SELCO officials complained that they 
are also hamstrung by excessive red tape, such as the requirement 
that the provincial People's Committee sign off on every loan 
application.  The local Women's Union is often helpful in pushing 
loan applications through the Committee in a reasonable amount of 
time. 
 
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JUSTIFIABLY PROUD OF THEMSELVES VIS-A-VIS THE KHMER? 
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11. (SBU) Provincial leaders in both provinces spoke proudly of 
their efforts to raise the living standards of the Khmer 
population to the level of their Vietnamese Kinh neighbors.  They 
attributed any lingering economic disparities to differences in 
educational attainment and family size, and dismissed allegations 
of discrimination as untrue.  As proof of the efficacy of their 
efforts, Chairman Hiep pointed out that the number of Khmer 
families under the poverty line had dropped from 64 percent to 
just 18 percent in little more than 10 years.  This was just five 
points higher than the poverty level for the province overall. 
The poverty rate for Tra Vinh has dropped from 40 percent to 19 
percent since 1992.  Both provinces had relied heavily on funds 
available from the central government under Program 135, started 
in 1999 to help eliminate poverty among the ethnic minorities. 
According to Vice Chairman Kim, the program was responsible for 
3301 projects in Tra Vinh over the past four years, valued at more 
than USD$5.1 million.  He spoke of the importance of 
infrastructure upgrades in terms of improving Khmer farmers' 
ability to get their goods to market without being exploited by 
Kinh middlemen. 
 
12. (SBU) Provincial officials also ran through the usual litany 
of programs available to ethnic minority groups throughout the 
country, such as small grants and loans, and free medical care. 
Ethnic minority students are eligible to receive a free education 
through the secondary level at provincial ethnic minority boarding 
schools.  Elementary level boarding schools are located in each 
district.  Successful graduates are able to enter university 
without sitting for the national entrance examination.  Families 
pay only expenses, while the government covers tuition.  Of the 
100 secondary school graduates in Tra Vinh each year, 40 enroll in 
some sort of vocational training, while 30 go on to university. 
The majority return to work in the local government.  (Fifty 
percent of the teachers at the boarding school are ethnic Khmer.) 
Khmer pagodas also conduct primary education classes, equivalent 
to Grades 1-5.  Chairman Hiep hoped to convert a 3500-student 
continuing education center/teacher training college into a 
community college for Soc Trang in the near future, while Tra Vinh 
has just established a community college with Canadian assistance. 
Bilingual education is widely available in both provinces, as are 
Khmer-language print and broadcast media. 
 
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SPEAKING OF RELIGION AND CULTURAL PRESERVATION 
--------------------------------------------- - 
13. (SBU) While in Tra Vinh, the DCM visited the Southern 
Secondary Pali Supplementary Education School, the only 
institution of its kind in Vietnam.  The two monks serving as 
Director and Deputy Director were clearly nervous to be speaking 
to what they described as the first diplomats to ever visit the 
institution, and read mostly from prepared briefing papers. 
Established in 1994, under the supervision of the Ministry of 
Education and Training, the school is funded by the central GVN 
and charges no tuition.  The four-year course provides the 
equivalent of a Grade 6-12 education in 11 subjects.  A special 
Khmer Ethnic Minority Committee sitting in Can Tho Province is 
responsible for recruiting students each year from all over 
southern Vietnam.  More than 500 students have enrolled in the 
school over the past nine years.  Graduates are expected to either 
return to their local pagodas to teach in primary education 
programs, or else continue their studies at the university level. 
The Director cited frequent exchanges between Theravada monks in 
Soc Trang, Cambodia, and Burma, and said religious texts were 
often exchanged as well, although these had to be cleared by the 
provincial Committee for Religious Affairs. 
 
14. (SBU) According to officials in both provinces, the Khmer tend 
to cluster near Theravada Buddhist pagodas (92 in Soc Trang and 
110 in Tra Vinh), but don't physically separate themselves from 
the Vietnamese Kinh or Chinese.  As is common in the Theravada 
tradition, most Khmer males in the two provinces become monks at 
some point, most often for two or three years prior to military 
training.  The DCM toured several Khmer pagodas, speaking to monks 
and ordinary Khmer residents, and elicited no complaints of 
discrimination or limitations on religious worship.  Mission 
officers frequently heard local residents speaking Khmer with one 
another.  Two Khmers from each province sit on the current 
National Assembly.  One of them serves on the legislative body's 
Commission on Ethnic Minority Affairs.  Khmers also fill many of 
the People's Committee slots at the district level. 
 
15. (SBU) Protestants and Catholics also seem to benefit from the 
emphasis that both provincial governments place on harmony.  There 
are seven legal Protestant churches registered with the GVN- 
recognized Southern Evangelical Church of Vietnam (SECV) in Soc 
Trang, and two in Tra Vinh.  Protestants not wanting to worship at 
these churches are free to worship at home.  ConGenoff visited one 
of Tra Vinh's two Protestant churches on a main street during an 
evening service.  According to the pastor and members of the 
congregation, there are fewer than 500 Protestants in Tra Vinh, 
including 200 Khmer.  Only 100 gathered in this particular church 
every Sunday, but the pastor visited others in outlying areas for 
smaller services in their homes on a regular basis.  The 
congregation reported no problems with freedom to worship, but did 
complain that the government had never returned a confiscated 
school on the church compound.  Otherwise, they found Tra Vinh 
officials to be cooperative and accommodating.  The congregation 
was in the process of building a new church to replace the 
existing structure (built in 1945), but was dependent on funding 
by mostly Korean benefactors. 
 
16. (SBU) The DCM and ConGenoff also visited one of three large 
Catholic churches in Tra Vinh that had been constructed by the 
French in the early 20th century.  While the buildings themselves 
were quite ornate, they were in need of renovation and 
maintenance.  According to the priest with whom we spoke, the 
church serves 5000 parishioners, with an overflow crowd on 
Sundays.  The last French priest had left in 1954, but the current 
number of Vietnamese priests is sufficient to serve the parish. 
The priest regretfully said there was not much to do anymore, 
since the school had been confiscated and the church was unable to 
undertake charitable activities. 
 
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COMMENT 
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17. (SBU) We were encouraged to see that the ethnic Khmer 
communities in both Soc Trang and Tra Vinh appear to be thriving 
culturally, if not economically.  While one expects to hear 
nothing but good things from provincial officials, the ordinary 
Khmer we encountered told consistent, unforced stories of equal 
opportunity and social and religious tolerance.  These will 
probably never be among the richest provinces in Vietnam, but the 
provincial governments seem to be taking the right steps to 
exploit whatever opportunities are available. 
 
18. (SBU) Of the two provinces, Tra Vinh would seem to be slightly 
more open to new ideas, as witnessed by the three foreign business 
delegations meeting with local officials in our hotel.  In 
general, the provincial leadership in Soc Trang was a bit more 
uptight, reading carefully from prepared scripts with talking 
points on "hostile forces" and the Vietnam Human Rights Act.  Just 
up the coast in Tra Vinh, meanwhile, Vice Chairman Kim actually 
started the meeting off with an offer to dispense with the usual 
scripted briefing and go right into the discussion.  He was 
animated and excited to be talking about his province.  Taking his 
leave at lunch for a trip to Hanoi, he said he was glad we had 
made the trip to see for ourselves that allegations of 
discrimination were untrue and that the provincial administration 
was committed to helping the Khmer. 
YAMAUCHI