Lucio Blanco Pitlo III

Opinion | Amid US-China rivalry, Vietnam’s sweet spot diplomacy is a master class

By keeping all the major actors engaged and invested, while embedding itself in global supply chains, Vietnam is growing its regional importance and strengthening its strategic autonomy

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Lucio Blanco Pitlo III

Published: 9:30am, 22 Dec 2023

Chinese President Xi Jinping’s visit to Hanoi last week underpinned Vietnam’s growing global profile, with major powers courting the Southeast Asian country.

Vietnam recently upgraded its ties with the United States and Japan to “strategic comprehensive partnerships”. During Xi’s trip, it endorsed China’s vision of a community with a “shared future”. Beijing’s three new projects – the Global Development Initiative, Global Security Initiative and Global Civilisation Initiative – also reportedly got Hanoi’s nod. Support was renewed for the China-backed Lancang-Mekong Cooperation.

By keeping all the major actors engaged and invested, Vietnam is embedding itself in global supply chains, growing its regional importance and strengthening its strategic autonomy. This shows the way for neighbours and others navigating great power rivalry.

Vietnam is in a sweet spot and not wasting it. It is the new darling of foreign capital and a rising manufacturing hub. It is emerging as an early winner of “de-risking”, cornering companies diversifying from China. Geopolitics and rising production costs in China are driving investors to relocate to Vietnam.

Vietnam’s continued success may hinge on its ability to tap opportunities from both the East and West. While the US and China are both vying for influence over Hanoi, in Vietnam, the economic interests of bitter rivals can converge – as long as the Southeast Asian nation deftly exercises its agency.

Xi’s two-day trip revealed how both sides are enmeshed geographically, politically and economically. The 36 cooperation documents signed show the breadth and depth of their ties.