Thayer Consultancy Background Brief

ABN # 65 648 097 123

Vietnam’s Prime Minister to
Address UN General Assembly
and Meet with U.S. Businessmen
September 26, 2018

We request a scene setting assessment of the issues that Vietnam’s Prime Minister
Nguyen Xuan Phuc will face this week in New York.
Prime Minister Phuc will deliver a speech at the UN on Thursday (September 27). The
main thrust of his speech will be the role of the U.N. in addressing global issues; the
importance of international rule of law and order; the importance of sustainable
development; Vietnam's accomplishment in attaining Millennium Development Goals
(MDGs); and most importantly, Vietnam's lobbying for the non-permanent
membership of the United Nations Security Council. Prime Minister Phuc also will
meet with American businessmen to discuss investment.
Q1. What is your assessment of the main themes to be addressed by Prime Minister
Phuc?
ANSWER: Vietnam is widely respected by the international community for its positive
and constructive role in advancing global and regional security. Prime Minister Phuc’s
speech to the UN General Assembly will be a practical demonstration of Vietnam’s
support for the United Nations, international law and sustainable development. These
are all key international issues at a time when the forces of protectionism, nationalism
and anti-globalism are challenging world order.
Prime Minister Phuc’s speech will be doubly important because Vietnam is the
unanimous choice of the Asia Pacific Group at the UN as its candidate for non-
permanent membership on the Security Council. His speech will reinforce the views
of General Assembly members who will vote to support Vietnam’s non-permanent
membership in June next year. The timing could not be better as on October 1st
Vietnam will send off its Level 2 Field Hospital contingent for the UN Mission in South
Sudan.
Q2. What do bilateral trade prospects look like for Vietnam under the Trump
presidency?
ANSWER: Vietnam ranks sixth on the list of countries with a trade surplus with the
United States. Fortunately for Vietnam this has not become a major issue in bilateral
relations. There are three sets of issues affecting two-way trade: (1) balancing “free
and reciprocal” trade, (2) U.S. imposed tariffs and (3) Vietnam’s designation as a non-
market economy. U.S. tariffs on Vietnamese exports of shrimp and catfish (basa, swai
and tra) are long-standing, while U.S. tariffs of Vietnamese aluminum and steel
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exports was imposed by the Trump Administration this year. These issues have been
relegated to a bilateral working or technical group, at the same time as Vietnam has
taken preliminary steps to seek a resolution through the World Trade Organization
(WTO). Progress is likely to be protracted and incremental.
Q3. How much of a setback was the U.S. withdrawal from the Trans-Pacific Partnership
(TPP) for U.S. security interests and its businesses in the region? What has been done
to resuscitate such setback?
ANSWER: President Trump’s decision to withdraw from the TPP created major
uncertainty in the region regarding the U.S. commitment to remain engaged in the
region. The decision by regional states to negotiate the TPP 11 somewhat mitigated
the economic impact of the U.S. withdrawal from the original TPP. Vietnam was most
affected because it had the most to gain from lower tariffs to the U.S. market.
Regional states have now turned to pushing forward negotiations on a Regional
Comprehensive Economic Partnership (RCEP) agreement that would align the
Association of Southeast Asian Nations’ (ASEAN) trade agreements with its dialogue
partners. The major issue here is the push by some states, such as Australia, for higher
standards.
The fundamentals of U.S. engagement with the region have not altered significantly.
The U.S. continues to be the largest investor and remains a major trading partner with
most states. The most serious issue facing the region is the impact of a major trade
war between China and the United States.
U.S. military engagement continues to be strong with the newest platforms and
weapons going to the Indo-Pacific Region. The Trump Administration has stepped up
freedom of navigation operational patrols and its continuous bomber presence flights
by B-52 and other strategic aircraft.
Q4. China has been accused of trying to mire states in the debt trap, with AIIB[Asia
Infrastructure Investment Bank] and BRI [Belt and Road Initiative] funding. Is this a
legitimate threat? Then what can the U.S. and its businesses do to help states counter
that threat?
ANSWER: China’s offers of grant aid and concessional loans certainly raises the
prospects that countries like Cambodia and Laos will fall into a debt trap. This is more
likely to occur under the BRI than development loans via the AIIB. This a legitimate
concern as witnessed by Malaysia’s new prime minister Mahathir cancelling several
high-cost BRI project to avoid unsustainable national debt.
The United States has taken the lead among its allies and partners in pushing back
against the BRI by providing funding for high quality infrastructure projects through
the World Bank, International Monetary Fund and Asian Development Bank. The key
to the U.S. strategy is motivate the private section in America and in friendly states to
become more proactive. Australia and Japan have agreed to follow the U.S.

Suggested citation: Carlyle A. Thayer, “Vietnam’s Prime Minister to Address UN

General Assembly and Meet with U.S. Businessmen,” Thayer Consultancy Background
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Thayer Consultancy provides political analysis of current regional security issues and
other research support to selected clients. Thayer Consultancy was officially
registered as a small business in Australia in 2002.