Vietnam has moved closer to joining the World Trade Organisation (WTO) after talks with US trade officials at the weekend ended with a bilateral deal paving the way to its accession.

US trade groups, however, are calling the agreement "a disaster for US manufacturing and the US textile industry in particular," because it fails to include adequate safeguards in the accession agreement to prevent Vietnam from engaging in "predatory trade practices."

Instead, they want to see an extension to the bilateral agreement signed between Vietnam and the US in April 2003 which imposes quotas on Vietnam's textile and apparel exports to the US, or safeguards imposed on Vietnam if it is admitted to the WTO.

The latest bilateral market access agreement, described as "very good" by US Trade Representative Rob Portman, will lower trade barriers on a wide range of US industrial and agricultural products and services, as well as continue the process of political and economic reform in Vietnam.

But the trade groups argue that because Vietnam, like China, is a non-market economy with a heavily subsidised state-owned textile industry, the US textile sector will be especially impacted as a result. Data for March 2006 puts Vietnam as the 6th largest exporter to the United States.

"This agreement provides an open invitation to continue the devastating trend of outsourcing the very jobs that are so critical to our middle class," said American Manufacturing Trade Action Coalition executive director Auggie Tantillo. 

He added that it could replicate the pattern of soaring imports into the US already seen with China.

Nearly half of Vietnam's current exports to the United States are in textiles and apparel, and have jumped by more than 5,700% since 2001. Vietnam's textile and clothing exports to the US were worth US$49m in 2001, rising to US$2.9bn in 2005.

"This deal is a double loser. It will further damage the hard-hit US textile industry and more than likely cause substantial job losses in Mexico and Central America," Tantillo added.