Thayer Consultancy

ABN # 65 648 097 123

Background Briefing: Vietnam Between Beijing and Washington Carlyle A. Thayer August 31, 2011

[clientnamedeleted] (1) Would you think that Vietnam has become even more wary with China in the pastyear,particularlygiventheirspatsovertheSouthChinaSea?Wouldyouseeany resolutiontotheirdispute? ANSWER:VietnamesewarinessaboutChinahasbeenrisingsince2008whenChina begantoactmoreassertivelyintheSouthChinaSeabyrigorouslyimposingitsannul fishingbanandapplyingpressureonforeignoilcompaniesnottoassistVietnamin developing hydrocarbon resources in the South China Sea. Vietnamese anxieties wereheightenedin2009whenChinaofficiallytabledamapwiththeUnitedNations Commission on Limits of Continental Shelf. This map contained nine dash lines claiming at least eighty percent or more of the South China Sea. Vietnamese concernsreachednewheightsthisyearwhenChinesevesselswereinvolvedintwo possiblythreereportedcablecuttingincidentsinvolvingVietnameseoilexploration ships. At the same time in 2010 China and Vietnam commenced confidential bilateral discussions on South China Sea issues. Seven sessions were held and the eighty is scheduled for later this year. The two have set priority on agreeing first on the principles that should guide a resolution of their territorial disputes. China has excludeddiscussionoftheParacelIslandsfromtheagenda. Vietnam has sent two special envoys to China. The first special envoy visited in FebruaryimmediatelyaftertheeleventhcongressoftheVietnamCommunistParty. Heconveyedaninvitationfromthenewpartysecretarygeneral,NguyenPhuTrong, for Chinese leaders to visit Vietnam. China, in turn, invited Vietnamese leaders to Beijing. Vietnamese sources say in deference to China Vietnams party leader will makethefirsttrip. This year China and ASEAN finally agreed on guidelines to implement the 2002 DeclarationonConductofPartiesintheSouthChinaSea. AresolutionofSouthChinaSeaterritorialandsovereigntydisputesisunlikelyforthe foreseeable future. But the trend of bilateral discussions between China and Vietnam coupled with multilateral discussions between ASEAN and China on implementingtheDOCsuggestaloweringoftensionsandtheinaugurationoflow levelconfidencebuildingmeasures.

2 Against this backdrop ASEAN will continue to press for a more stringent Code of ConducttobeadoptedbyNovember2012onthetenthanniversaryoftheDOC. (2)HanoiseemstobeeagerperhapstooeagertoengageWashingtonevenmore deeply. Do you think this is good strategy (i.e. getting the US as a balance in the ChinaVietnambilateral)? ANSWER: Vietnam has little choice but to support a balance among the major powersinSoutheastAsia.OtherwiseVietnamwouldfallintoChinasorbitorbeleft relativelyisolated.Vietnamsactionsshouldnotbeviewedasanattempttoallywith WashingtonagainstBeijing.Rather,VietnamseekstodemonstratethattheU.S.has alegitimatesecurity role intheregion.Vietnamdoessobypermittingannualship visits,repairingUSmaritimesupportships,andbyflyingoutofficialstoUScarriersin theSouthChinaSeaastheypassby. Vietnamisengagedinarobustprogramofselfhelpinmodernizingitsarmedforces. SofarRussiahasbeenthemainprovider.VietnamseekstopriseopenaccesstoU.S. defenseequipmentandtechnologythatiscurrentlybeingwithheld. Vietnam also pursues a policy of encouraging other major powers such as India, Japan, Russia, South Korea and Australia to play a security role in Southeast Asia. VietnamsuccessfullypromotedtheASEANDefenceMinistersMeetingPlusprocess. There is a risk Vietnam could overplay its hand but the record to date indicates Vietnamhashandleditsmultidirectionalpolicydeftly.LastyearaftertheUSSJohn McCain visited Da Nang with much fanfare, Vietnam hosted one of Chinas more modern guided missile frigates in Da Nang to little publicity. This year Vietnam conducteditssecondnavalportvisittosouthernChinaaftercompletingscheduled jointpatrolswiththeChinesenavyintheGulfofTonkin.ThisyearVietnamhosteda visit by the number two on Chinas Military Affairs Commission and currently its deputyministerofnationaldefenceisvisitingBeijing. The bottom line is that the U.S. is Vietnams largest trading partner. This offsets VietnamsUS$13billiontradedeficitwithChina. (3) Do you think that Hanoi's engagement of Washington would enable it to carve outsomediplomaticbreathingroomforitselfvisvisChina? ANSWER:VietnamsengagementwithWashingtonwillprovideballastinitsrelations with China. Vietnam can subtly signal to China that assertiveness on Beijings part will result in an incremental stepping up of relations with China. For example, in 2009 Vietnamese officialsflewouttotheUSSCarlVinson asittransitedtheSouth ChinaSea.LaterintheyearVietnamsdefenceministerstoppedinHawaiienrouteto WashingtonandwasphotographedpeeringuptheperiscopeoftheUSSFlorida.In 2010, while marking the 15th anniversary of diplomatic relations with the U.S., Vietnamese officials flew out to a USS George Washington as it passed Vietnams central coast, while half a world away Vietnams deputy ambassador attended the launchofthenewestU.S.carrier,theUSSGeorgeBush,inNorfolk,Virginia.Lastyear when Vietnam was Chair of ASEAN it lobbied the U.S. to make a diplomatic intervention at the 17th ARF meeting last year. It is significant that China, which began 2011 with a series of assertive actions against the Philippines and Vietnam over the South China Sea, toned down its actions in midyear on the eve of the

3 ASEANandrelatedsummits,includingtheARF.Atthesametime,SinoUSrelations appearonthemend.ThistrendshouldcontinueastheEastAsiaSummitnears.