349. Letter From the Assistant Secretary of State for Far Eastern Affairs (Robertson) to the Deputy Director, Plans, Central Intelligence Agency (Wisner)1
Dear Frank: Referring to your memorandum of September 27,2 on Western participation in Vietnamese industry, I certainly agree that everything possible should be done to encourage foreign private capital investment in Viet-Nam, both as a means of reducing our very heavy financial commitment for aid, and as a means of insuring the development of that country in the most rapid and effective fashion. I am very pleased to see that President Diem desires United States private capital investment in Viet-Nam and believe that he should be encouraged to take effective steps leading to such investments becoming an actuality.
Approximately two months ago we learned that the Vietnamese were considering the enactment of a foreign investment law and feared that, in view of the ultra-nationalistic tendencies among certain Vietnamese officials, such a law if enacted at the present time might contain restrictive features which would discourage rather than encourage foreign investment. In our telegram 525 to the Embassy in Saigon3 we suggested that it would be wiser at the present time for the Vietnamese to proceed on an ad hoc basis contracting with each potential investor as a separate case, thereby gaining experience upon which to base an investment law in the future. However, as indicated in the reply of Embassy Saigon contained in its telegram 7164 apparently some Vietnamese believe that it is necessary to press for a liberal investment law at this time in order to head off an ultra-nationalistic approach.
The basic problem at the present time seems to be creation of a climate highly favorable to foreign investment in Viet-Nam of which an investment law would be only one element. In our communications with Saigon, cited above, we pointed out that signing of an FCN treaty between Viet-Nam and the United States would be helpful in this regard and in response to our approach negotiations are now underway with the Vietnamese on such a treaty. A statement by the President of Viet-Nam such as that attached to your memorandum—copies of this proposed statement were also left with me by General O’Daniel and forwarded by our Embassy in Saigon under [Page 747] cover of Despatch 93 of September 15, 19565—would also be helpful in creating the necessary favorable climate.
I believe that President Diem should be encouraged to make a statement along these lines. I think that in advance of such a statement we should not give copies of any proposed statement to the French, British, Italian, West German, and Japanese Embassies here in Washington as suggested in your memorandum. I believe that any statement by the Vietnamese President along these lines should initially be called to the attention of these Governments by the Vietnamese themselves since our doing so would only give further ammunition to those who charge that Viet-Nam is under the domination of the United States and that the United States has an inordinate amount of control over Viet-Nam. Therefore, I believe that after President Diem has made his public statement, he should be encouraged to bring this statement to the attention of the Governments of all non-Communist countries whose nationals might be interested in investment in Viet-Nam.
A copy of your memorandum and of this reply are being sent to the Embassy in Saigon for its information and appropriate action.
Sincerely yours,
- Source: Department of State, Central Files, 800.05151G/9–2756. Secret. Drafted by Price and cleared in SEA and FE.↩
- Supra.↩
- Dated August 20, not printed. (Department of State, Central Files, 751G.34/8–856)↩
- Dated August 29, not printed. (Ibid., 751G.34/8–2956)↩
- Not printed. (Ibid., 751G.34/9–1556)↩
- Printed from a copy which bears this typed signature. According to a memorandum from Leonard Tyson of FE to Jones, October 8, this letter was signed by Robertson and sent to Wisner. (Ibid., FE Files: Lot 58 D 209, Indochina 1956)↩