A retired Vietnamese general who is honoured and respected in his country for playing a central role in defeating the American Forces in the Vietnam war, is now playing a key role in the development of a financial centre on an isolated Vietnamese island.

A delegation was here last week for a first-hand look at the Bermuda model.

A senior advisor to his government, General Tran Bach Dang left Bermuda this weekend after leading a group here to study cultural, sociological and economic factors that led to Bermuda's success in the business world.

Gen. Tran hopes to develop a similar offshore financial centre for Vietnam on the small, unspoilt island of Phu Quoc.

The move comes as Vietnam's economy is being converted from a socialist command economy to a free enterprise model.

The country hopes to attract $50 billion of foreign capital by the turn of the century and it is thought this will become easier if it is accepted as expected as a member of the Association of South East Asian Nations (ASEAN), now made up of Thailand, Brunei, Singapore, the Philippines, Indonesia and Malaysia.

In 1988 the Vietnamese adopted a new Communist party philosophy that has been dubbed "Doi Moi'', ("New World'') which is loosely described as an open door policy designed to attract foreign investment.

While the country retains its socialist political system, the economic system is becoming quite capitalist.

The Chinese, the French, the Japanese and more recently, the Americans have been among the unwelcomed invaders of the past centuries. Now the Vietnamese is inviting capital from those countries and others in Asia, Europe and the Americas.

Phu Quoc island, an archipelago in the Gulf of Thailand, is a part of the Kien Giang province, west of the Mekong Delta. "Phu Quoc''means "The rich nation''. The island is well known in Vietnam for its unspoilt natural beauty, fertile soil and high yield fishery.

That is about to change.

Mekong Holdings Ltd. has been formed to develop the Island into an offshore financial centre, a high quality tourism jurisdiction, a deep sea port for containerisation and an export processing zone.

The money is essentially from North America and the major promoter is a Canadian firm, Vancouver-based Ivanhoe Capital.

The company will develop the infrastructure of the island and look at developing the natural resources of the area, including fishing, agriculture and offshore oil and gas mining exploration.

Mekong director Mr. David Boehm is an Australian businessman, a partner in the Certified Public Accountants firm of Grant Thornton Byrne, the Hong Kong member firm of Grant Thornton International.

He said: "The reason we came to Bermuda was to meet with the authorities and representatives of the business community here to give the Vietnamese a concept, such as you have in Bermuda, of a high quality offshore financial centre and a high quality tourism destination.'' A video documentary of Bermuda and the visit of Mr. Boehm and General Tran, together with the chairman of Kien Giang People's Committee, Mr. Pham Van Minh, and others meeting with Bermuda officials was taped for the benefit of the cabinet and the Prime Minister of Vietnam.

The delegation met with the Bermuda Monetary Authority, representatives of two of the banks and accountants and lawyers.

In an interview that was interpreted by Mekong Holdings Ltd. director, Mr. Van Huong Nguyen, General Tran explained: "We had to change everything after the (Vietnam) war. We knew that winning the war was senseless if we would not be able to rebuild our country.

"I have been studying a lot about Bermuda history and learning a lot about the conditions that led to the building of the modern day Bermuda. Our countries are not the same. Vietnam is larger with a larger population, with different needs, and the conditions were not the same.

"We had to find the key to open our country to the rest of the world.

Naturally, we are still facing difficulties. Based on our lessons from other countries, like Bermuda, we will be able to overcome our difficulties.

"Already in South East Asia, people are beginning to talk about Vietnam as the next (economic) tiger. But that will not happen overnight. It will take some time. Hopefully, it won't be that long, as we have already begun to assemble favourable conditions for economic growth.'' When asked if the 70-year old general expected to have his dreams realised in his lifetime, he replied with a grin through the interpreter: "I hope to live a very long life.'' Negotiations with the Vietnamese Government were only concluded in May and a contract was signed in September between Mekong and the People's Committee to enter into a joint venture to develop the island.

General Tran and chairman Pham have been the ones who have been making representations to the Central Government in an effort to obtain approval. A master plan for the financial centre and the draft legislation is expected to be ready for Government scrutiny next year May. They are expecting final approval by the third quarter of next year.

The developers won't wait, however, to build a three star hotel, and they hope to have the financial centre actually built by the end of next year.

Mekong Holdings will launch a $100-million fund raising campaign in the middle of next year. But they will be working with others in the private sector that will bring fresh and varied expertise into the project.

Vietnam has a population of about 70 million people. They are more likely to have a radio (one per 10 people) or a television (one per 31 people) than a telephone (1 per 544).

Phu Quoc has a population about the size of Bermuda. Inflation is down to single digit levels, after being more than 100 percent a few years ago. Their currency, the Dong, has been stabilised, although it was quoted this week as requiring about 11020 dongs to buy one Bermuda dollar.

The 1991 GNP of Vietnam was $15.2 billion, and it imported $1.9 billion worth of goods from the Commonwealth of Independent States (CIS) and Japan exported $1.8 billion worth of goods to Vietnam. Its national budget was $1.3 billion in expenditures.

Economic growth has averaged eight to nine percent. General Tran has been credited with the advice that has led to much of the economic improvement.

Mr. Boehm said: "General Tran is from the Kien Giang province and it has been one of his dreams to develop this island into an economic powerhouse along the lines of Singapore and Hong Kong.

"He has been invaluable to us in guiding us as to the correct approach in dealing at the provincial level and at the central government level. We have to work with eight provincial ministries that have jurisdiction over the island.'' The concept of an offshore financial centre is not easily understood by the Vietnamese people. It is Tran who translates the ideas, through the respect lavished on him by his people. He is reverently referred to as "Dr. Tran''.

He was the commander in chief of the Viet Cong forces in Saigon (now Ho Chi Minh City) and at the war's end was also the political leader of the region, the general secretary of the Communist party.

Like many of his generation, he was too busy in the military to get a formal education, but political superiors have spent many years taking his advice.

His business card for English-speaking people describes him as an historian, writer, columnist and vice chairman of the Social Sciences Council.

Chairman Pham, also using an interpreter, said that he will be sitting at a corporate decision-making level, representing the interests of the people and the communist party in Mekong's planning meetings.

"We have traveled to Hong Kong, Singapore and Vancouver apart from Bermuda.

But we thought it was important to come to Bermuda.'' The Vietnamese delegation were intrigued by the cultural diversity here, especially as different nationals and different races work side by side to achieve a common goal.

NO PAPER TIGER -- The delegation which hopes to develop a financial centre in Vietnam. From left, Mekong Holdings Ltd. directors Mr. Edward C. Rochette and Mr. David P. Boehm, General Tran Bach Dang, Chairman Pham Van Minh of Kien Giang People's Committee and Mekong Holdings director, Mr. Van Huong Nguyen.