In Vietnam, Obama Charts the Way for a 21st-Century Partnership

By Phuong Nguyen —

Secretary of State John Kerry poses for a selfie with Vietnamese students in Hanoi, Vietnam. Source: State Department's flickr photostream, U.S. Government Work.

Secretary of State John Kerry poses for a selfie with Vietnamese students in Hanoi, Vietnam in August 2015. Source: State Department’s flickr photostream, U.S. Government Work.

If Bill Clinton traveled to Vietnam to “heal the wounds of war” in 2000 and George W. Bush to announce the country was open for business when he rang the bell of the Ho Chi Minh City stock exchange in 2006, President Barack Obama will usher in a new chapter in U.S.-Vietnam relations when he visits the capital Hanoi and economic hub Ho Chi Minh City on May 23-25.

The timing of the visit could not be more opportune. It is the last bilateral visit Obama is expected to make to a Southeast Asian country before his term ends in January 2017 (he will travel to Laos in September to attend the annual East Asia Summit). The visit will mark the culmination of what has been achieved—and an embodiment of the potential still to be harvested—under his policy of rebalancing to the Asia Pacific, and refocus on Southeast Asia in particular.

Hanoi is still configuring the final contours of a new government following a major leadership transition earlier this year. As the first foreign head of state to call on the new leadership, Obama’s visit is evidence of the remarkable rise in importance that Vietnam attaches to relations with the United States. After earlier plans for Obama to visit Vietnam in late 2015 were aborted due to logistical challenges, Hanoi quickly focused on the current timing — when Obama travels to Japan to attend the G7 summit — to ensure that the U.S. presidential visit takes precedence over other state visits to follow for the new government.

The facts and figures driving U.S.-Vietnam relations are well known. Vietnam is the largest U.S. trading partner in Southeast Asia—with bilateral trade hitting $45 billion last year. Fully 89 percent of the Vietnamese public surveyed supports the U.S.-led Trans-Pacific Partnership trade agreement, while 71 percent welcome a greater U.S. military presence in the region.  The country sends the largest contingent of students (nearly 19,000 this year) to study in the United States among Southeast Asian countries. The favorability rating of the United States polls around 80 percent in Vietnam, while the U.S. ambassador to Vietnam, Ted Osius, is unmistakably a household name in the country.

Those who believe economics are the foundation of U.S. staying power in a 21st-century Asia need look no further than Vietnam. It is true that China’s aggressive posture in the South China Sea has served as a catalyst for U.S.-Vietnam relations in recent years. However, looking at the relationship through this lens alone misses a bigger picture.

Capturing her time at the U.S. Trade Representative’s (USTR) office working on Asia, former acting deputy USTR Wendy Cutler said earlier this year that Vietnam “has proven itself as a risk-taker, a regional leader,” one that “has repeatedly stepped up to the plate and made the difficult decisions to reform and open its economy and take on international obligations.”

Vietnamese leaders understand that without a globally integrated, developed, and diversified economy, no amount of security assistance from or granting of basing access to foreign powers can help Vietnam cope with the security and strategic challenges that a rising China poses to the region.

It is this calculus that drives Vietnam’s overall engagement strategy toward the United States. Vietnam’s diplomats and military leaders alike often tell their American guests that economic cooperation — rather than security ties — should be the driver of U.S.-Vietnam relations into the future. Vietnam’s politicians have made it clear they would like to see and will create favorable conditions for the United States to become the largest investor in Vietnam (U.S. companies currently rank 7th).

A surprising 95 percent of the Vietnamese public surveyed believe in the power of a free market system, even if it creates winners and losers, making Vietnam the most capitalistic society in the world — a statistic important to policymakers trying to shape future U.S. economic policy toward Asia-Pacific countries.

Vietnam’s laudable accomplishments in economic development since opening up in the late 1980s notwithstanding, its efforts at regional economic integration were not always implemented evenly. While Hanoi’s centralized political structure often gives the semblance of smooth decision-making—which, in many instances, is true — there are frequent internal differences that affect the pace of progress. This recognition drove Washington to engage directly, and in substantive ways, with the ruling Vietnamese Communist Party — still the heart of most decision-making in Hanoi — early in the rebalance. Cultivating these channels will become more critical as U.S.-Vietnam relations advance.

While enthusiasm in some quarters about Vietnam’s role as an emerging key economic partner in Southeast Asia is justified and should be sustained in future years, it will need to go hand in hand with a realistic grasp of Vietnam’s political realities.

While in Hanoi, Obama will also discuss important issues in bilateral security cooperation, human rights, and legacies of the Vietnam War with his hosts. Shared U.S. and Vietnamese interests in preserving the rule of law and maritime security in the strategic South China Sea mean that bilateral defense relations will gradually expand and acquire more depth, and at a pace with which both sides are comfortable. Vietnam’s defense engagements with the United States already exceed Hanoi’s engagements with any other country in both quantity and quality. But pinning high hopes on Vietnam becoming a sort of security ally in the next phase of relations would be a misread of what is possible in U.S.-Vietnam ties.

The two decades since normalization of ties in 1995 have been transformative for both sides. All indicators suggest that the next 20 years will see the two countries move even closer toward one another. The key to making the relationship deliver for the United States will lie in fostering Vietnam as a central element in U.S. economic strategy and leadership in 21st-century Southeast Asia.

Ms. Phuong Nguyen is an associate fellow with the Southeast Asia Program  at CSIS. Follow her on twitter @PNguyen_DC.

Phuong Nguyen

Phuong Nguyen

Phuong Nguyen is an adjunct fellow at CSIS focused on Southeast Asia.


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