WASHINGTON — President Clinton said Thursday the U.S. was ending its 19-year embargo on trade with Vietnam, a decision apparel and importer executives say could spur that country to become a sourcing powerhouse.

Administration officials noted that the action, which was widely expected, does not mean the U.S. is normalizing relations with Vietnam, such as granting it most-favored-nation trade status.

However, even with the high tariffs Vietnamese goods will carry without MFN, the country is still seen as having strong potential for sourcing.

Laura Jones, executive director of the U.S. Association of Importers of Textiles and Apparel, said she sees Vietnam developing into an apparel source alternative to China for some U.S. firms “especially since the U.S. has such tight growth rates on Chinese quotas.”

Eugene Milosh, president of the American Association of Exporters and Importers, said, “Given the right machinery, Western design and assistance — in other words, the importer — Vietnam could grow into a significant apparel source just as China did even before it had MFN.”

“I believe Vietnam will become a real hot market since it has a good labor force, low costs and a lot of new capacity to stage exports,” said Andrew Postal, president of Judy Bond, a company that does offshore sourcing. Postal said he learned that Taiwanese producers began setting up plants in Vietnam to make apparel “as soon as the embargo was lifted.”

Robin Lanier, a trade vice president with the International Mass Retail Association, said he expects Vietnam to eventually gain MFN.

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