WASHINGTON : The United States and its former battlefield enemy Vietnam are to launch talks to frame a pact that could set the stage for a bilateral free trade agreement.

US Trade Representative (USTR) Susan Schwab and visiting Vietnamese Deputy Prime Minister Pham Gia Khiem met on Friday and "they announced the launch of negotiations to conclude a Trade and Investment Framework Agreement (TIFA)," Schwab's office said on Monday.

The agreement "will serve as a platform on which the two countries will work to further strengthen their trade and investment ties," it said in a statement.

The TIFA, many experts say, is the prelude to a free trade agreement.

The US Congress formally granted Vietnam "permanent normal trade relations" in December just before the communist nation officially became the 150th member of the World Trade Organisation (WTO) in January.

Under its membership terms, hammered out with the United States, other trade partners and the WTO, Vietnam must scrap a range of tariffs, subsidies and other barriers that protect local industries.

In return, Vietnam - a major exporter of oil, textiles, footwear, rice, seafood and coffee - will face fewer hurdles in selling its goods abroad and have recourse through the WTO in case of trade disputes.

"Vietnam is a dynamic and rapidly growing economy, and we see a TIFA as an important vehicle for promoting continuation of the impressive expansion in our trade and investment relationship that we have witnessed over the past few years," Schwab said.

The TIFA will establish a formal dialogue under which the two countries intend to discuss new initiatives to deepen their trade and investment ties, the USTR office said.

It also will provide a forum for monitoring Vietnam's implementation of its WTO and bilateral trade agreement commitments.

Vietnam is the 43rd largest goods trading partner of the United States with US$9.7 billion in total goods trade last year. - AFP/de