HANOI -- When Army Sgt. Steve Flaherty was killed in action in South Vietnam in 1969, his letters home fell into the hands of the enemy, which quoted his private thoughts about the war in propaganda broadcasts.
On Monday, in the first high-level exchange of its kind since the war, Gen. Phung Quang Thanh, Vietnam's defense minister, handed the three yellowing letters to Defense Secretary Leon E. Panetta, a gesture aimed at healing some of the personal wounds that remain over a war that ended nearly 40 years ago.
Panetta, for his part, handed over a small maroon diary, found by a U.S. Marine, of a Vietnamese soldier named Vu Dinh Doan, who was killed in a machine-gun pit during a fierce battle near the coastal town of Quang Ngai.
The Pentagon already has been in touch with Flaherty's family members about handing over the letters to them, a U.S. official said, and Panetta voiced hope that the diary could be returned to Vu Dinh Doan’s family.
Vietnamese officials also informed Panetta that they would allow excavations at three sites that have been kept off limits to investigators searching for the remains of U.S. service members killed in the war, according to U.S. officials.
Panetta, on a nine-day visit to Asia, is in Vietnam for talks with government officials on deepening military ties as the Obama administration is reasserting the U.S. role as a Pacific power after a decade of war elsewhere.
Seeking to counter China's growing military might, Pentagon planners are seeking closer ties to countries on China's periphery and access to ports and other facilities to beef up the U.S. presence in potential trouble spots.
At a news conference with Panetta after their talks, Thanh emphasized that the U.S. could continue to send supply and other unarmed Navy vessels to Cam Ranh Bay, the deep-water port off the South China Sea that Panetta says the U.S. would like to use for its naval vessels.
But the Vietnamese official gave little indication in public that his country was prepared to allow U.S. warships to call there, a key Pentagon goal. Even decades after the war, Vietnam remains wary of drawing too close to the U.S. or to neighboring China, its longtime regional rival.
Thanh called on the U.S. to lift a ban on selling weapons and other lethal military equipment to Vietnam, implying that doing so might make his country's leaders more willing to consider the U.S. request to send more ships to Cam Ranh Bay.
The U.S. provides Vietnam with modest amounts of nonmilitary aid every year, but selling weapons "would benefit the two countries and help fully normalize relations," Thanh said.
Panetta gave an indication of the lingering sensitivities in Washington, especially in Congress, about expanding aid. Vietnam's government "represses virtually all forms of dissent" and "freedom of expression, association and public assembly are tightly controlled," according to Human Rights Watch.
"Obviously additional assistance will depend in part on progress that's being made on human rights and on other reform," Panetta said.
The announcement that Vietnam would allow U.S. investigators to search for remains at three additional sites was welcomed by U.S. officials as an indication that Hanoi is looking for ways to improve relations, U.S. officials said.
There are still 1,284 U.S. service members lost in Vietnam who are unaccounted for, but the window of time for resolving the cases is closing, officials said. Vietnam's reddish clay soil is acidic, causing human remains to break down faster than in other parts of the world. Meanwhile, family members in the U.S. and witnesses in Vietnam with information about possible sites are growing older and dying, officials said.
U.S. military officials involved in the recovery effort, who briefed Panetta at their Hanoi headquarters, estimated they had five to seven years to complete their work.
[Updated 1:38 p.m. June 4: Returning the letters and diary required some detective work as well.
A Vietnamese army colonel kept Flaherty’s letters for decades, finally writing about them in a Vietnamese online publication last year. A retired Defense Department employee who read his account alerted the Pentagon, which sought their return.
Officials said Robert “Ira” Frazure, originally from Walla Walla, Wash., found the wartime diary on the chest of a Vietnamese soldier after the 1966 battle. A PBS show, “History Detectives,” assisted in the effort to return the diary, eventually turning to the Pentagon and State Department for help.]
-- David S. Cloud
Photo: Defense Secretary Leon E. Panetta gives Vietnam War memorabilia from a Vietnamese soldier killed in the war to his Vietnamese counterpart, Gen. Phung Quang Thanh, during a joint news conference. Credit: Na Son Nguyen / Associated Press