Associated Press

Associated Press Hanoi

U.S. business delegation said on Thursday that Vietnam's growing economy is ripe for foreign investment.

"For American business, this is the year to focus on Vietnam. Vietnam is a stable, fast-growing and promising market for American companies," said Ernest Bower, president of the U.S.- Asean Business Council, a private business lobbying group.

The delegation, which included representatives from a dozen major U.S. firms including Boeing, Citigroup, Ford Motor, Unocal and UPS, is spending the week touring Vietnam.

The group has had meetings with Deputy Prime Minister Vu Khoan, Planning and Investment Minister Vo Hong Phuc and Trade Minister Truong Dinh Tuyen.

In the past decade, Vietnam has been pursuing economic reforms. But it has struggled to attract foreign investors, with many overseas companies deterred by red tape, corruption, and lack of transparency.

But the communist country is now actively wooing foreign investors, with an eye on entering the World Trade Organization by 2005. Vietnam's economy grew 7% last year.

Raymond Sander, senior vice-president of New York Life Insurance, said the Vietnamese leaders expressed a willingness to address investors' concerns.

"I was very encouraged by not only their recognition of these issues, but their commitment to resolve a number of the problems," he said.

The government is planning to privatize 1,200 state-owned companies over the next two years, and foreigners are allowed to hold up to a 30% stake in these entities, a senior official said Thursday.

The U.S. is officially the 11th largest foreign investor in Vietnam, though U.S. investments through Asian subsidiaries push that ranking up to fifth, Bower said.

Bilateral trade between the two countries has boomed since the signing of a historic trade deal in 2001, reaching a record $6 billion last year. The U.S. has become Vietnam's largest trading partner.