Vietnam's Pivot

How Hanoi Learned to Stop Worrying and Love the United States

By David Brown in Foreign Affairs

SEPTEMBER 9, 2014

(http://www.foreignaffairs.com/articles/141970/david-brown/vietnams-pivot)

Vietnam's international strategy is shifting in a dramatic fashion. For years, the country hoped that it could manage China’s drive for regional hegemony by showing Beijing sufficient deference. To that end, officials in Hanoi worked to cultivate ties with their Chinese counterparts and pursued friendships with all countries, Vietnam’s ASEAN neighbors especially, but alliances with none. 

But that strategy has been upended in recent months. In May, China deployed a $1 billion oil drilling rig and more than 100 ships to locations only 130 nautical miles off of Vietnam's central coast, well within Vietnam's exclusive economic zone (EEZ) -- the maritime area extending 200 nautical miles from a country’s shores over which it has special exploration and resource exploitation rights.  Hanoi responded with a total of 30 diplomatic overtures to Beijing; China rejected all of them, refusing even to receive the secretary-general of Vietnam’s ruling Communist Party, Nguyen Phu Trong. When Chinese State Councilor Yang Jiechi came to Hanoi on June 18, it wasn’t to apologize but, rather, to upbraid the Vietnamese for their own behavior -- that is, for their protests against the oil rig and for allowing anti-Chinese demonstrations to get out of hand. Chinese media portrayed Yang as giving Vietnam a chance “to rein itself in before it's too late.”

China's deployment of the deep sea rig should not have been a surprise. At least since 2009, Beijing has aimed to achieve de facto hegemony over the South China Sea, and Vietnam's offshore oil sector has been a prime target. Beijing's threats induced oil multinationals BP and ConocoPhillips, both heavily invested in China, to abandon concessions in Vietnamese waters in 2009 and 2012 respectively. In 2011, Chinese vessels harassed survey ships belonging to the Vietnamese oil company PetroVietnam. In 2012, China's Offshore Oil Corporation (CNOOC) invited foreign companies to bid for the rights to explore nine blocks of territory overlapping Vietnam's EEZ.

At the end of July, Vietnam was awash with rumors that the country’s Politburo had voted 9–5 in favor of “standing up to China.” There was also talk that an extraordinary plenum of the 200-member Party Central Committee would convene to review and confirm the Politburo's new tilt. The rumors may simply reflect the wishful thinking of a public that's been far more disposed to tangle with China than its leaders have been. Beijing and Hanoi are still pro forma friends; Le Hong Anh, Vietnam's top cop and a stalwart of the pro-China faction, was correctly welcomed in Beijing in mid-August and doubtless warned against unfriendly moves. Even so, chances are good that Vietnam will soon take two game-changing steps.

First, Vietnam will likely challenge China in international courts, seeking a verdict that declares Beijing's assertion of "historic sovereignty" over nearly all of the South China Sea to be illegitimate and its tactics impermissible. Hanoi initially considered such a move last year, when the Philippines invited Vietnam to join its own case against China at the United Nations Law of the Sea Tribunal. Hanoi chose not to participate at that time. But on May 14, two weeks after Beijing parked the drill rig offshore, Vietnamese Prime Minister Nguyen Tan Dung told newswires that his government is contemplating legal action. Late in July, the Ho Chi Minh City Law University convened a high-profile conference at the government’s request to recommend legal strategies.

Second, Vietnam is likely to forge a more intimate diplomatic and military relationship with the United States -- not a formal alliance but a partnership based on a common interest in preventing Chinese hegemony in the South China Sea. Pham Binh Minh, who serves as Vietnam’s foreign minister and one of its four deputy prime ministers, will be the central figure in these efforts. Several days after China deployed its oil rig, U.S. Secretary of State John Kerry invited Minh to visit Washington. That trip will take place in late September.

In advance of Minh's trip, Evan Medeiros, senior director for Asian affairs on the U.S. National Security Council, paid a quiet visit to Hanoi in late July. Medeiros was followed immediately by U.S. Senators John McCain and Sheldon Whitehouse, and two weeks later by General Martin Dempsey, chairman of the U.S. Joint Chiefs of Staff, whose four-day visit earned heavy coverage by Vietnamese media. Both McCain and Dempsey dropped broad hints that Washington is primed to relax its existing ban on transfers of lethal weapons to the Vietnamese military. Both mentioned the need to enhance Vietnam's “maritime domain awareness."

Some observers have argued that, by politically distancing itself from Beijing, Vietnam could instigate an economic war with China that it can’t afford to wage. But such fears are overblown. Vietnam exports coal, oil, timber, and agricultural products to China and imports machinery and cheap consumer goods; that part of the bilateral trading relationship trade is not only roughly balanced, but both countries can also readily find other markets for those wares. If there's a problem, it lies in the electronic parts, textiles, zippers, buttons, and shoe parts that are sent to Vietnam from China for assembly and re-export: although these imports create a huge deficit for Hanoi, they are more than offset by Vietnam's sales of finished wearables and digital gadgets to Europe, Japan, the United States, and elsewhere in the world. It could take a year or two to reestablish these value chains if China is angry enough to sever them.

But here again, the United States seems to offer a potential refuge: the Trans-Pacific Partnership (TPP) trade pact, a negotiation that Vietnam joined in 2009. Vietnam is the least-developed of the 12 TPP negotiating partners and stands to see its exports leap by a third if the pact goes into effect. Anticipating provisions in the pact that will privilege garments made entirely in TPP member countries, Chinese, South Korean, Taiwanese and Vietnamese firms are building Vietnam's capacity to source inputs for garments and footwear at home.

Hanoi wants the United States to agree to lift its ban on lethal weapons sales, a step that Washington has conditioned on Hanoi's improving its treatment of political dissidents. For both governments, it's a matter of principle. There is a yawning gap between the United States’ insistence that the Vietnamese regime respect fundamental political rights and Vietnamese Communist leaders' belief that tolerating agitation for democracy poses an existential threat to their system.

On this matter of political freedoms, Hanoi, Washington, or both must compromise if they are to move ahead, but neither country has much room for maneuver. Many members of Congress will be wary of embracing Hanoi, even if they acknowledge that forestalling China’s regional hegemony is in both countries’ interest. For its part, the Vietnamese Politburo's vision of political order has limited its ability to compromise on human rights. And yet, if Hanoi cannot pledge to open up the sphere of political participation, or Washington cannot take a longer view, the long-discussed strategic relationship will still be beyond reach.

It's a tough call for the Obama administration. In the South China Sea, Beijing is no longer "peacefully rising" -- instead, it has become the neighborhood bully. Vietnam, as distasteful as its politics may often be, is the only country in Southeast Asia both able and, if properly encouraged, willing to resist the Chinese juggernaut.