Vietnam and Diplomatic Balancing

Hanoi is having to walk a careful line in its relations with China and the U.S.

Vietnam and Diplomatic Balancing
Credit: Chairman of the Joint Chiefs of Staff

Last year witnessed growing tensions in the South China Sea between Vietnam and China, taking diplomatic relations between the two countries to their lowest point since the end of the Sino-Vietnamese War in 1979. In contrast, Vietnam and the United States have enjoyed significant developments in their ties, which will coincide this year with the 20th anniversary of diplomatic relations. Being directly threatened by China in the South China Sea, Vietnam needs a strong partner like the United States to help secure its sovereignty. Depending on China and America for different reasons, Vietnam finds itself needing to balance its diplomacy to effectively manage its relations with the two superpowers.

After the HD 981 incident, many analysts talked up relations between Vietnam and America. In the wake of the tensions, the two nations sent senior envoys to strengthen ties. Washington offered warm greetings to Hanoi Party Committee Secretary and Politburo member Pham Quang Nghi during his visit in late July, while for its part Hanoi welcomed a U.S. Senate delegation in early August led by Senators John McCain and Sheldon Whitehouse, and later the very first visit of a U.S. Army General since the Vietnam War. Later, in September, Hanoi dispatched its Deputy Prime Minister Vu Van Ninh to America for talks on enhancing bilateral trade and the Trans-Pacific Partnership (TPP) negotiations. Most remarkably, Deputy Prime Minister and Foreign Minister Pham Binh Minh’s visit to America partially lifted the embargo on lethal arms sales to Vietnam. Clearly, Vietnam and America have broken new diplomat ground, but an alliance between the two countries is unlikely any time soon.

Carefully considering its proximity to China, Vietnam dispatched a delegation led by Politburo member Le Hong Anh on August 26 to help ease tensions. Vietnam recognizes that China is the key economic and security player in Asia. China is also one of the world’s leading military powers and a military confrontation would be fatal for Vietnam. Quite aside from its military disadvantage, conflict with China would also derail Vietnam’s developing economy. China supplies Vietnam with more than 50 percent of its textile raw material, much of which Vietnam uses to make clothes to sell in European and North American markets, from which it obtains foreign currency. Vietnam ran a trade deficit with China of about $24 billion (worth 15 percent of Vietnam’s GDP) in 2013. Recently, Vietnam joined the China-led Asia Infrastructure Investment Bank (AIIB), and plans to borrow money for infrastructure development. In addition, Chinese companies have won more than 90 percent of major engineering, procurement, and construction contracts in Vietnam. Understanding these vulnerabilities, Vietnam will not risk its relationship with China.

Could Russia be a counterweight for Vietnam? This looks unlikely following Western sanctions, which have prompted Russia to increasingly turn to China. For instance, last year Moscow and Beijing signed a $400 billion gas deal. Both Russia and China participate in economic organizations such as BRICS and the Shanghai Cooperation Organization. The two countries share a common worldview and closer economic ties could eventually lead to geopolitical cooperation, giving China influence over Russia’s Southeast Asian policies. Knowing the importance of its own close economic relations with China, Russia will likely stay out of the Vietnam-USA-China triangle.

This is not the first time Vietnam has had to walk a careful diplomatic line. During the Vietnam War, Vietnam maintained good relations with both Russia and China, even while those two powers were fighting a border conflict. Today, Vietnam has a similar situation: China provides economic benefits while United States offers security. With its “three nos” policy (no military alliances, no foreign military bases on Vietnamese territory, and no reliance on any country to combat others), Vietnam is doing its best to balance relations with China and the United States.

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Still, concessions have limits. Unless China stops trying to alter the status quo in the South China Sea, Vietnam will soon have to reconsider the balance between economic benefits and national security and choose the option that reflects the will of the Vietnamese people.