Biden Meets Vietnam Leader to Strengthen US Alliance in Asia

(Bloomberg) -- President Joe Biden celebrated “a new era of relations” with Vietnam as he met with the country’s Communist Party’s General Secretary To Lam amid US efforts to counter Chinese economic and security influence across Asia.

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The two nations are “united building a more open and secure” Indo-Pacific region and are “committed to freedom of navigation and rule of law,” Biden said, hailing the two nations’ joint efforts since they upgraded diplomatic ties during Biden’s visit to Vietnam in September last year.

Biden also highlighted investments in semiconductors and supply chains and “unprecedented cooperation on cybersecurity” with Vietnam, while the country’s top leader responded by noting Biden’s “historic contributions” to the elevated bilateral relationship.

The relationship “is truly a model in international relations for efforts to heal and build post-war relations,” Lam said in his meeting with Biden, according to a posting on the website of Vietnam government.

The meeting on the sidelines of the United Nations General Assembly in New York underscores the Southeast Asian country’s growing geopolitical importance. Vietnam has emerged as one of the biggest winners from the US-China trade rivalry, with multinationals redirecting billions of dollars to Beijing’s neighboring manufacturing powerhouse in a bid to secure supply. Hanoi also has a long-standing territorial dispute in the South China Sea with its powerful fellow Communist country.

While China wasn’t mentioned in the leaders’ opening remarks, Biden has made no secret of his campaign to leverage allies and partners in the region to counter the growing influence of the world’s No. 2 economy. In their private meeting, both leaders recognized that Vietnam must navigate a complicated neighborhood with complex relationships, a senior administration official who spoke to reporters on the condition of anonymity said afterward.

Aside from that multilateral work, the Biden administration’s strategy toward China has hinged primarily on restricting China’s tech sector in the name of national security while pursuing “intensive diplomacy” to keep up communications and minimize the risk of open conflict.

At the same time, the August rejection of Vietnam’s request to be classified as a market economy by the Biden administration was a setback for the country’s efforts to boost exports to its most important market — and could threaten US efforts to woo countries away from China. The Vietnam leader has told US investors he expects the market economy designation soon.

The leaders cast their economic relationship more broadly and noted shared intent to redouble cooperation, while the US downplayed the significance of the market-economy status and Biden encouraged ongoing economic reform and opening of Vietnam’s economy, the US senior administration official said.

Read: US Rejects Vietnam Request to Lift ‘Non-Market Economy’ Tag

“If they got market economy status, this massive trade Vietnam has with the US will be even easier to conduct,” said Carl Thayer, emeritus professor at the University of New South Wales.

Lam, who became the nation’s top leader after the death of longtime Communist Party General Secretary Nguyen Phu Trong in July, is looking to burnish his geopolitical credentials, said Alexander Vuving, an Asia expert at the Daniel K. Inouye Asia-Pacific Center for Security Studies in Hawaii.

The party chief has held meetings with executives from corporate behemoths such as Boeing Co. and Meta Platforms Inc., imploring them to step up investment in Vietnam.

Lam, who is also the country’s president, addressed the United Nations General Assembly on Tuesday. He called for support for developing and underdeveloped countries, “especially in terms of preferential capital, transferring advanced technology, training high-quality human resources, facilitating investment and trade, and reducing debt burden.”

The former public security minister, seen as the key enforcer of the nation’s sweeping anti-corruption crackdown, is also pragmatic, Vuving said. Vietnam, whose human rights record is frequently criticized by the US and others, quietly released leading climate activist Hoang Thi Minh Hong and dissident Tran Huynh Duy Thuc ahead of Lam’s US visit.

Trong’s death, and a political shakeup tied to the anti-graft campaign that has ensnared top government leaders, has rattled some investors and slowed government decision-making for business-related activities.

The Biden meeting signals Vietnam’s core policies aren’t changing as it continues to balance great power relations and expand economic ties, Vuving said. Lam met with Chinese President Xi Jinping in August, his first overseas trip as party chief.

“Investors see that and will be even more confident investing in Vietnam,” Vuving said.

--With assistance from John Boudreau and Clarissa Batino.

(Updates with Lam comment in the fourth paragraph.)

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