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Vietnam terraced hills

Shared vision behind Australia's new strategic friendship with Vietnam

By Dr Huong Le Thu

When then Prime Minister Paul Keating visited Vietnam in 1994 - a year before Vietnam normalized relations with the US and joined ASEAN - he came home convinced that this Southeast Asian nation would gain strategic weight. Today with a highly motivated, entrepreneurial, outward-looking population of some 94 million, Vietnam is emerging as a key regional actor, and an important partner for Australia. Recognizing this, Canberra will sign strategic partnership next week when PM Nguyen Xuan Phuc arrives to attend the Australia-ASEAN Special Summit.

Vietnam’s recent deepening ties with the US, Japan and India presents a conducive factor. The historic visit to Danang by the American aircraft carrier, the USS Carl Vinson, can be seen as a symbol of important change. The same week, President Tran Dai Quang paid a state visit to India – with whom Vietnam has the highest level of comprehensive strategic partnership, next to China and Russia – to advance and concretize cooperation. Late last year, Hanoi upgraded its relations with Tokyo to extensive strategic partnership, and with the US to enhanced comprehensive partnership. Hanoi’s active engagement with these four powers is not accidental – in fact, of all Southeast Asian countries, Vietnam is potentially most eager to see concrete materialization of the Quadrilateral Security Dialogue. Its commitment to maintaining maritime security makes it a vital partner for those who also pledge to ensure that the Indo-Pacific remains free and open.

Nearly 45 years after the last Australian troops left Vietnam, the two countries have every reason to be trusted partners.

Formal diplomatic relations were established in 1973 with the then North Vietnam. Australia became a major destination for Vietnamese refugees in the 1970s and 80s and now has second largest Vietnamese population outside of that country –  by 2016 accounts some 294,798 people claim Vietnamese ancestry. Vietnam is the third largest population in Southeast Asia – expected to reach 100 million in 2025; it ranks first in terms of middle-class growth, and second in terms of urban population growth. Vietnam’s strategic position is not only important because of its position on the South China Sea, but also because of access to the Greater Mekong Subregion, which serves as a land bridge connecting the markets of China, Southeast Asia and South Asia. Vietnam is Australia’s fastest growing trade partner in the ASEAN region. Its exports to Vietnam have grown by 16 percent annually for the past decade and grew from US$32.3 million in 1990 to US$6 billion in 2017.

But Australian Foreign Direct Investment in Vietnam, which totalled US$1.65 billion in 2017, has not made to the top ten investors’ list.  Its rapidly growing market is not its only asset. Its ambitious, increasingly highly-educated workforce and entrepreneurial society present opportunities for many Australian sectors, particularly energy, education and agricultural to increase their investments.

Both Vietnam and Australia are committed to make the proposed Trans-Pacific Partnership (TPP-11) happen.

The strategic partnership with Vietnam is an early and concrete realization of the goals of the Foreign Policy White Paper released late last year in which Canberra committed to paying more attention to Southeast Asia. In the White Paper, Vietnam was described as a partner that was increasingly prosperous, outwardly-focused, stable and resilient. The relationship with Vietnam has been on a positive, yet rather gradual trajectory. The first formal strategic dialogue between Hanoi and Canberra took place 20 years ago, in 1998. The recent boost happened after 2014 when the China dispatched the oil rig HYSY-981 to Vietnamese waters. In 2015, then Prime Minister Nguyen Tan Dung visited Canberra to enhance the ties to the comprehensive partnership, that existed between the two nations since 2009.The decision to elevate it to a strategic partnership was announced during the Asia-Pacific Economic Cooperation (APEC) Summit which was held in Danang, in November last year.

But this strategic partnership is more than just an outcome of favourable conditions, it needs strategic constellations to align. Indeed, it reflects the recognition of mutual strategic importance as well as a sense of growing necessity for cooperation. Australia and Vietnam share not only vision of a stable and peaceful region, but also a commitment to guard the stability and peace through support for the rules-based-order and for multilateral institutions.

Australia has welcomed Vietnam’s more active role in multilateral frameworks, both regional and global. Hanoi’s contribution to the UN Peacekeeping forces has been welcomed in Canberra. Last August, during her visit in the region, Defence Minister Marise Payne offered assistance and training for peacekeeping personnel. She also indicated support for Hanoi’s bid for re-election as a non-permanent member of the UN Security Council for 2020-21.

There are fundamental differences in Australia’s and Vietnam’s political systems, which for a long time remained a complication for closer cooperation. However, the Australia-Vietnam strategic partnership proves that security cooperation is possible despite the political differences when actors are responsible stakeholders upholding to the international law. The strategic partnership is an important diplomatic reassurance. It opens up the way for Australia and Vietnam to work more closely on key areas of common interests, particularly in the maritime domain. They share increasingly converging regional security outlook. They are also complimentary many aspects: Australia’s naval capability, among other, promises some training opportunities to Hanoi, while Vietnam can offer some of its long-term experience in coping with China.

Originally published by: Australian Financial Review on 12 Mar 2018