Vietnam’s Rising Geopolitical Importance
US Defense Secretary Leon Panetta’s visit to Vietnam earlier this week demonstrates that Washington is continuing to reach out to Hanoi as a new regional partner, as America refocuses on the Asia-Pacific region after a decade of wars in Afghanistan and Iraq. In a special feature on Business Monitor Online, we discuss Vietnam’s significance in South East Asian geopolitics:
Long coastline on the South China Sea: Vietnam has a very long coastline, spanning almost the entire western stretch of the disputed South China Sea. (China regards the entire sea as its own and has become more assertive in its claims since 2010, whereas Vietnam, the Philippines, and several other states claim the sea in part.) This means that Hanoi cannot help but have an interest in the affairs of the South China Sea, whose importance stems from the fact that it is a major shipping route; the significant oil and gas reserves there; and its considerable fish supplies. If Vietnam were to ally with China, then this would significantly enhance Beijing’s control of the South China Sea. As it happens, Vietnam’s suspicion of China means that Beijing has a formidable competitor for control of the Sea. Even if Vietnam does not ally with the US, Hanoi’s stance denies Beijing complete supremacy over the Sea, and this benefits other countries with claims on its waters, most notably the Philippines. Meanwhile, Japan, South Korea, and Taiwan also do not wish to see Chinese dominance of the South China Sea, because this could theoretically interfere with their shipping.
Mainland South East Asia influence: Vietnam also has a high degree of political and economic influence in Laos, where it competes with China and Thailand for loyalty and business. Vietnam’s influence in Cambodia is less clear cut, because although the Phnom Penh leadership is on amicable terms with Hanoi, there is widespread distrust of Vietnamese intentions among ordinary Cambodians. Nevertheless, with Vietnam generally warming to the US, Thailand having officially been designated a US ‘Major Non-NATO Ally’ in 2003, and Myanmar moving towards rapprochement with the West, it is evident that mainland South East Asia’s three most populous countries are seeking to counterbalance Chinese influence in the Asia-Pacific region.
Vast economic potential and large population: Vietnam’s geopolitical importance has also been boosted by its rapid economic growth, especially over the past decade, which has made the country a major emerging market and an attractive investment destination. In fact, some Japanese, South Korean, and Western multinationals are said to favour Vietnam as an alternative to China, partly as a hedge against political risk in China (although there is considerable political risk in Vietnam, too), but also because Vietnam offers competitive labour costs. Vietnam’s economic prospects are augmented by its large and youthful population (88mn and still rising), and the country also has the 11th-largest armed forces in the world, with 455,000 personnel. As Vietnam’s economy and population grow, the country has the potential to emerge as a middle-ranked power in its own right, making it all the more attractive as a partner to countries seeking influence in South East Asia (i.e., China, the US, Japan, and India).
The full article, which also discusses the prospects and risks for Vietnam’s geopolitical emergence and ties with the US, is available to subscribers on Business Monitor Online.