Capitalizing on thawing diplomatic and economic relations, Internet telephony specialist iBasis has signed a deal to tie Vietnam's largest telecommunications provider into its network.

The deal will allow Vietnam Telecom International (VTI) to route calls over iBasis' global infrastructure. In turn, Burlington, Mass.-based iBasis will to route international calls into the Southeast Asia country through VTI's local lines.

"We are very excited at the prospects for our relationship with VTI, the telecommunications leader in a very fast-growing market," said Ofer Gneezy, iBasis' president and CEO.

Global voice traffic into Vietnam grew 37 percent from 1999 to 2000, according to research from Telegeography, (more recent statistics are unavailable). During that same period, voice traffic from the United States to Vietnam grew by 56 percent, placing it among the top 20 U.S. outbound calling destinations.

In recent years, the U.S. and Vietnam governments have taken a number of small, but important steps to "normalize" trade, nearly 30 years after officially ending the war.

"As the largest carrier in Vietnam, a rapidly-growing nation of more than 78 million people, we sought the best and most efficient global voice service available," said Nguyen Huu Khanh, VTI's deputy managing director. "With their extensive experience in major Asian markets and Tier 1 reliability, iBasis was our clear choice."

Since its founding in 1996, iBasis has arranged similar deals to increase its coverage. Most recently, it inked a deal with Telenor, a Norway telecommunications carrier. Elsewhere in Asia, iBasis counts China Mobile and China Unicom as partners.

Shares of IBAS closed Friday at 0.75. In the last 52 weeks, the issue has ranged from 0.36 to 5.36. The company has a market value of $33.9 million.