Vietnam’s moderate diplomacy successfully navigating difficult waters

Author: Thuy T. Do, ANU

Vietnam’s diplomacy saw many successes in 2014, but also faced many challenges.

In early May, the country saw the worst maritime tension with China since their 1988 naval clashes in the South China Sea (SCS). The placement of China’s oil rig in Vietnam’s claimed exclusive economic zone and the tense vessel confrontation between the two coast guards for almost ten weeks not only sparked large anti-China protests throughout Vietnam but also precipitated a heated internal discussion on the need to rethink Vietnam’s China policy — how to escape China’s orbit.

At the height of the crisis, some of the most radical elements within the Vietnamese intelligentsia suggested that the country should build strategic allies with the US and its partners as a counter-measure against China’s possible territorial encroachment.

Shortly after the crisis, Japan announced that it would provide Vietnam six patrol vessels, funded by foreign aid. On 2 October, the US partially lifted its lethal arms sales, paving the way for Hanoi to purchase high-end equipments to enhance its maritime capacity. On 28 October, India also announced that it would sell $100 million worth of naval and patrol vessels to Vietnam in exchange for energy exploration rights.

Clearly, Vietnam’s strategic role has become more salient in the US Asian pivot, Japan’s Look South strategy, and India’s Act East policies. This, in turn, facilitates Hanoi’s goal of internalising the disputes so as to restraint China’s unilateral actions. The downside of this, however, is that Hanoi risks becoming a proxy for other powers to contain China’s assertiveness in maritime disputes.

Hanoi’s strategy thus far has been moderate: seeking to mend fences with China and reiterating its long standing ‘three nos’ defence policy (no foreign bases in Vietnamese territory, no military alliances, and no relationships against a third party) while strengthening ties with other powers.

Why? First and foremost, this nuanced reaction reflects the historical roots of Vietnam’s strategic thinking, one that views a workable relationship with China as vital to ensure Vietnam’s stability and security. Following the removal of the oil rig on 15 July, Hanoi has sent two high-ranking delegations to China (by Politburo member Le Hong Anh in August and Defence Minister Phung Quang Thanh in October) during which the two sides agreed to repair ties and to establish a military hotline to forestall incidents like the oil-rig dispute in the future.

Second, the management of the oil rig crisis, from a Vietnamese perspective, was a success. The two factors that have contributed to the peaceful resolution of the tensions, as Foreign Minister Pham Binh Minh outlined, are Vietnam’s experience in dealing with China and the support received from the international community. Minh further argues that, ‘other countries, for example the Philippines may not predict [China’s behaviour] but we do, we know China.’

Third, economic benefits matter. While recently pursuing an ‘economic pivot’ to Japan with a focus on investment and the US with a focus on exports and the TPP, Vietnam still immensely relies on Chinese imports. Despite the rhetoric of ‘escaping China’s orbit’, Vietnam’s trade deficit with China is expected to hit a new record of US$27 billion in 2014. Hanoi also cannot ignore the ‘carrots’ Beijing is offering, including the ‘Maritime Silk Road’ and the Asian Infrastructure Investment Bank (AIIB) initiatives.

Arguably, the logic of ‘if it ain’t broke, don’t fix it’ applies in Vietnam’s strategic thinking with respect to China. Yet Hanoi may find it increasingly difficult to maintain this approach should China continue crossing red lines. On 11 December, Vietnam joined the Philippines and the US in rejecting China’s nine-dash line in the SCS in its statement of interests submitted to the Court in the Hague that is handling the Philippines-China case. If anything, this action has ushered in a shift towards a bolder approach in Hanoi’s stance.

With all this in mind, 2015 promises to be a year of important tasks for Vietnamese diplomacy. On 30 April, the country will celebrate the 40th anniversary of the end of the Vietnam War. National reconciliation is expected to be high on the agenda of Hanoi’s policy towards the large overseas Vietnamese community. Nationalism and tensions may arise, however, when it comes to sensitive issues such as ‘political dissidents’ and the SCS disputes with China.

It will also have been two decades since Hanoi’s historic triple decisions to deepen its integration into the international community: it joined ASEAN, normalised relations with the US, and concluded the Framework Agreement with the EU. Diplomatic negotiations are currently undertaking to prepare for high-ranking visits to celebrate the 20th anniversary of the normalization of Vietnam–US relations. There are chances that Hanoi and Washington may decide to lift their current ‘comprehensive partnership’ framework to a ‘strategic partnership’ level in the year. Nonetheless, much of this progress will depend on how the two countries settle their differences over human rights issue.

Last but not least, 2015 will be an important transitional year towards the 12th Party Congress. Almost 30 years after the Doi Moi reforms of 1986, it is now time for the Party to review the lessons of that period so that better economic policies can be devised to help the country escape the ‘middle-income trap’. In a speech at the Asia Society in New York on 24 September 2014, Foreign Minister Pham Binh Minh stated that in order to secure a favourable place in the evolving world order, Vietnam needs to deepen economic reforms, to further its open and self-reliant foreign policy, to act as a responsible player in the world affairs, and to promote an ASEAN-led regional order. It is on these crucial points that Vietnam should reposition itself better.

Thuy T Do is a PhD candidate at the Department of International Relations, The Australian National University and a lecturer at the Diplomatic Academy of Vietnam.

This article is part of an EAF special feature series on 2014 in review and the year ahead.