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Background Briefing: Vietnam: Assessing President Truong Tan Sangs Visit to the United States - 3 Carlyle A. Thayer July 28, 2013

[client name deleted] Q1. What is your assessment of President Truong Tan Sangs visit to the U.S.? ANSWER: President Truong Tan Sangs visit must be judged a success. His visit marked the resumption of high-level visits after a hiatus of five years. President Sang and President Obama agreed to characterize their bilateral relations as a comprehensive partnership. This agreement contained a commitment to conduct high-level exchanges and established a new bilateral political-diplomatic mechanism at ministerial level. President Sang took a forthright stance in addressing U.S. concerns over human rights and took the initiative by bringing with him religious dignitaries from Vietnam to speak directly to the American side. Q2. Do you think the results of President Sangs visit met the expectations of both sides? ANSWER: It is no secret that Vietnam and the United States have been negotiating a strategic partnership since 2010. This type of agreement has a different meaning to both sides. The U.S., for example, places greater stress on defence and security cooperation in its understanding of a strategic partner. In fact the first reference to Vietnam as a potential U.S. strategic partner came in the Quadrennial Defence Review of 2010. Vietnam has negotiated twelve strategic partnership agreements with foreign countries and it prefers to use this term to describe comprehensive bilateral relations with a greater emphasis on multiple areas of cooperation. In their presidential discussions, both sides put economic and trade issues first as their main priority and both sides came away with an agreement to try and conclude negotiations on the Trans-Pacific Partnership (TPP) by the end of this year. There remain several difficult issues for both sides to address. But the larger picture is that President Obama supports the TPP to assist the recovery of U.S. industry and to create jobs for Americans. Vietnam supports the TPP because it will greatly assist its international economic integration. Q3. Presidents Sang and Obama agreed to upgrade their bilateral relations to comprehensive partnership. How should we view this new term? ANSWER: Actually, Vietnam and Australia negotiated a strategic partnership but in the end, at Australias insistence, the agreement was titled a comprehensive

2 partnership. The U.S.-Vietnam agreement is largely a political statement that bilateral relations have developed depth and breadth across a number of areas. A comprehensive partnership agreement seeks to enhance relations across multiple areas through bilateral coordinating mechanisms. Q4. How will this newly announced framework contribute to further development of the U.S. Vietnam relationship? ANSWER: The comprehensive partnership will result in more frequent dialogue and consultations between the U.S. and Vietnam and thus raise the efficiency of bilateral relations in nine areas: political and diplomatic; trade and economic ties; science and technology; education cooperation; environment and health; war legacy issues; defense and security; and promotion and protection of human rights. The present agreement calls for the creation of new mechanisms in each of these areas. Through these mechanisms each side will come to understand the other side a bit better and build trust. This will result in greater cooperation. Q5. The U.S. and Vietnam agreed on a comprehensive partnership, not strategic partnership as initially recommended by Vietnam. What factors do you think led to this change? What might be the difference between a strategic partnership and a comprehensive partnership? ANSWER: U.S.-Vietnam negotiations on a strategic partnership reportedly stalled in late 2011 over disagreement on how human rights should be addressed. U.S. officials have since linked progress on the TPP and other cooperation to demonstrable progress on human rights. The U.S. side has strategic partnership agreements with Singapore and Indonesia. It appears that the U.S. side made the judgment that bilateral relations must be developed further before they can be termed a strategic partnership. Vietnam, which has promoted the term strategic partnership in relations with the major powers, likely had second thoughts about whether increased defense and security cooperation might be viewed as aligning too closely with the United States. President Truong Tan Sangs visit was hastily arranged. Officials on both sides had only two weeks to prepare. It is likely that Vietnam had a more limited objective than a formal strategic partnership agreement. In other words, it suited the interests of both sides not to proceed too quickly. The main difference between Vietnams existing strategic partnership agreements and the comprehensive partnership agreement with the U.S. is that the former include a high-level mechanism to coordinate all areas of cooperation on a regular basis. Cooperation also is included in a separate multi-year Plan of Action. Q6. How do you assess the discussiosn on maritime security in relation to the South China Sea dispute? Some analysts say that it is important that the U.S. government voices its support for American oil companies cooperation with Vietnam. What impact do you think this support may have on the South China Sea dispute? ANSWER: Basically both sides share the same commitment to the rule of international law and the peaceful settlement of disputes without force or the threat of force. Both sides easily agreed on supporting the effective implementation of the Declaration on Conduct in the South China Sea. And both sides gave their support to

3 the negotiation of a Code of Conduct (COC). It is significant that the Joint Statement issued by presidents Obama and Truong Tan Sang included specific references to cooperation between American oil companies, Exxon Mobile and Murphy Oil, and PetroVietnam. Support for the COC and the inclusion of references to AmericanVietnam oil cooperation should provide a measure of deterrence to China against taking any assertive actions. Q7. What is your assessment of President Sangs message as well as his dealings with U.S. officials? ANSWER: President Truong Tan Sang was poised, articulate and successful in conveying Vietnams stance and viewpoint to his American audience. He was most adroit in handling the human rights issue. He agreed to discuss this issue and called for dialogue. President Sang also committed Vietnam to signing the UN Convention Against Torture and inviting the Special Rapporteur on Freedom of Religion or Belief to visit Vietnam in 2014. Despite disagreements between the U.S. and Vietnam, both sides agree to further cooperation in nine major areas, most notably political-diplomatic, trade and economic relations, science and technology and education. This is a plus for Vietnam as it pursuit proactive international integration.

Suggested citation: Carlyle A. Thayer, Vietnam: Assessing President Truong Tan Sangs Visit to the United States - 3, Thayer Consultancy Background Brief, July 28, 2013. All background briefs are posted on Scribd.com (search for Thayer). To remove yourself from the mailing list type UNSUBSCRIBE in the Subject heading and hit the Reply key. Thayer Consultancy provides political analysis of current regional security issues and other research support to selected clients. Thayer Consultancy was officially registered as a small business in Australia in 2002.

Thayer Consultancy
ABN # 65 648 097 123

Background Briefing: Vietnam: Assessing President Truong Tan Sangs Visit to the United States - 4 Carlyle A. Thayer July 28, 2013

[client name deleted] What is your assessment of yesterdays meeting between Presidents Barack Obama and Truong Tan Sang at The White House? Did you find anything especially notable or surprising in the Joint Statement or in their remarks to the press? ANSWER: The most surprising outcome of the presidential meeting was how human rights was dealt with. Prior to this meeting U.S. officials stated that there must be demonstrable progress on human rights in order to take the bilateral relationship further, even linking demonstrable progress on human rights to the Trans-Pacific Partnership (TPP). The comprehensive partnership as outlined in the Joint Statement committed both sides to completing TPP negotiations by the end of the year. Of course this is not a binding commitment but it is a goal that both parties have an interest in achieving. Vietnam addressed U.S. concerns head on. President Sang appears to have shaped the outcome by bringing along some religious dignitaries to discuss religious freedom issues. This really was a diversion as the suppression of political and civil rights is far greater than restrictions on religious freedom. For its part, Vietnam committed itself to further dialogue, inviting the Special Rapporteur on Freedom of Religion or Belief to Vietnam in 2014, and signing the UN Convention Against Torture. Basically the two sides agreed to disagree. When human rights is raised Vietnam invariably seeks an increase in U.S. assistance in addressing two wartime legacy issues: unexploded ordnance and Agent Orange. This issue received a separate heading in the Joint Statement. It was listed sixth out of nine areas for future cooperation. President Obama did not make any major commitment to increase funding to address this issue, but President Sang noted the U.S. government would conduct an environmental assessment of dioxin contamination at Bien Hoa Air Base. So far U.S. efforts have focused on Da Nang. Second, I found the emphasis on future defence and security cooperation much stronger in remarks made at the post-meeting press conference than in the Joint Statement. The Joint Statement appeared to be a reiteration of defence cooperation activities already approved and underway. Current high-level dialogues apparently will continue without significant change.

2 Third, I found the reference to cooperation agreements between Exxon Mobile and Murphy Oil with PetroVietnam in the South China Sea significant. This underscores the U.S. insistence on unimpeded lawful commerce. It also offers Vietnam the assurance that American companies will continue to assist in the exploration and development of offshore hydrocarbon resources despite Chinese objections. In short the reference to cooperation in oil and gas cooperation in the South China Sea in the Joint Statement is a low level form of deterrent against renewed Chinese assertiveness. Fourth, there were three positive and potentially significant developments. The US and Vietnam committed themselves to completing TPP negotiations by the end of the year. And the U.S. and Vietnam agreed to set up a high-level political-level mechanism at ministerial level. President Obama promised to do his best to visit Vietnam before the expiration of his term in office. Fifth, it would appear that neither side was prepared to enter into a more formal strategic partnership agreement at this stage. The two presidents laid the foundation for upgrading bilateral relations. But for the moment they prefer a looser comprehensive partnership. This lacks two key ingredients found in Vietnams other strategic partnership agreements: a high-level joint coordinating mechanism and a multi-year Plan of Action. The Joint Statement basically reaffirmed existing bilateral mechanisms while holding out the promise of creating new mechanisms in the nine areas of cooperation. Sixth, while nothing new emerged from presidential discussions on the South China Sea, President Sang was unusually frank in his remarks during the question and answer period following his address to the Center for Strategic and International Studies (CSIS). Sang, according to my hand written notes, dismissed Chinas 9 -dash line claim as groundless, legally and practically. Finally, Sangs visit was arranged at short notice, with only two weeks for advanced preparations. Trade and economic issues in general and the TPP in particular were the center piece of his visit. Obama and Sang met for one hour and 15 minutes. They discussed nine topics or about eight minutes per topic including translation. In contrast, Sang and Chinas Xi Jinping met for three hours.

Suggested citation: Carlyle A. Thayer, Vietnam: Assessing President Truong Tan Sangs Visit to the United States - 4, Thayer Consultancy Background Brief, July 28, 2013. All background briefs are posted on Scribd.com (search for Thayer). To remove yourself from the mailing list type UNSUBSCRIBE in the Subject heading and hit the Reply key. Thayer Consultancy provides political analysis of current regional security issues and other research support to selected clients. Thayer Consultancy was officially registered as a small business in Australia in 2002.

Thayer Consultancy
ABN # 65 648 097 123

Background Briefing: Vietnam: Assessing President Truong Tan Sangs Visit to the United States 5 Carlyle A. Thayer July 29, 2013

[client name deleted] We request your assessment of the outcome of talks between presidents Barck Obama and Truong Tang Sang on July 25 at The White House. Specifically, we request your assessment of the following issues: Q1. The visit by Vietnamese President Truong Tan Sang to the U.S. took place amid stepped up relations between Vietnam and the U.S. For the first time, the two countries established a comprehensive partnership. What is your assessment of this new relationship? ANSWER: U.S.-Vietnam bilateral relations have definitely increased in breadth and depth over the last decade. President Sangs visit resumed high-level contacts between the two governments and resulted in an agreement to hold high-level meetings on a more regular basis in future. The agreement on Comprehensive Partnership is a more formal recognition of the growth of bilateral relations. Both sides regularly described each other as partners. The Comprehensive Partnership agreement mainly reiterated areas of cooperation that were already underway. Importantly it created a new high-level politicaldiplomatic mechanism between Vietnams Minister for Foreign Affairs and the U.S. Secretary of State. Finally, the Comprehensive Partnership committed both parties to creating new mechanisms for cooperation in nine areas: political and diplomatic relations; trade and economic ties; science and technology; education and training; environment and health; war legacy issues; defense and security; protection and promotion of human rights; and culture, sports and tourism. Q2. Is the U.S. decision to reach a comprehensive partnership agreement with Vietnam linked with the U.S. policy of rebalancing towards the Asia-Pacific? ANSWER: The United States has come to appreciate the emergence of Vietnam as an important country contributing to regional peace and security in Southeast Asia, especially in ASEAN, and internationally as well through the United Nations and other multilateral institutions. The United States policy of rebalancing includes both economic and security aspects. Vietnam and the United States share many similar views on both these

2 issues. The U.S. wants to increase the involvement of American business in Vietnam (and Southeast Asia as a whole) and Vietnam wants continued access to its largest export market, the United States. The U.S. would like to increase the presence and access of it military forces in Southeast Asia to ensure that the security environment remains peaceful. Vietnam welcomes this U.S. presence as long as it contributes to peace, cooperation, prosperity and development. But Vietnam does not want to be seen as leaning towards one major power against another. The two sides reached a Memorandum of Understanding on Defense Cooperation in 2011 and agreed that cooperation under this document should continue. As a result of the Comprehensive Partnership agreement the two sides will expand cooperation in less sensitive areas such as search and rescue, disaster response and non-traditional security issues. Importantly both will work to enhance cooperation in maritime law enforcement cooperation. Q3. U.S-Vietnam negotiations about the TPP reached an impasse a long time ago. Many Vietnamese and regional experts conclude that President Sangs visit will be a turning point for Vietnam and the U.S. to conclude the TPP negotiations. What is your assessment of this point? ANSWER: The two presidents reaffirmed their commitment to conclude a comprehensive, high-standard Tans-Pacific Partnership (TPP) agreement as soon as possible this year. There are serious issues to be resolved and some tough negotiations must take place before such agreement is reached. A TPP agreement will be difficult to reach with the late inclusion of Japan among the countries involved. There are also differences between other prospective TPP members and the United States. The commitment by the two presidents will give renewed impetus to the stalled TPP talks but compromise by all parties will be necessary to reach a final agreement. It is possible that the negotiators will agree to phase in commitments in sensitive areas. What is also clear is that both Vietnam and the United States have a direct economic interest in a TPP agreement. Q4. In light of the current uptick in U.S.-Vietnam relations, what forecast can you offer about future development in the Asia-Pacific Region in general and territorial disputes in the South China Sea in particular? ANSWER: The two presidents repeated long-standing policy on the South China Sea. They stated that territorial disputes must be settled in accordance with international law, including UNCLOS, and the non-use of force or threat of force. Both supported the full implementation of the Declaration on Conduct of Parties in the South China Sea (DOC) and forthcoming ASEAN-China negotiations on a Code f Conduct (COC). Of significance is that the presidential Joint Statesmen on Comprehensive Partnership specifically mentioned commercial relations between the U.S. Export-Import Bank, Exxon Mobile and Murphy Oil and PetroVietnam for investment in the South China Sea. This reference should be read in conjunction with recent strong statements by Vice President Joe Biden and the new Assistant Secretary of State for East Asia and the Pacific, Daniel Russel (who replaced Kurt Campbell), against any nation using intimidation, coercion or force. The United States is clearly signaling it will respond if China attempts to impede lawful commercial activities. This should stabilize the environment in the East Asia and create conditions for Vietnam to further develop its energy resources.

3 Q5. What is your assessment of the reaction by Chinas leaders to the comprehensive partnership agreement reached between Vietnam and the United States? ANSWER: Both China and Vietnam have used strategic partnership agreements to shore up their ties with foreign states. Vietnam and China created a strategic partnership in 2008 and later raised this to strategic cooperative partner. The United States has negotiated strategic partnership agreements with Singapore and Indonesia. On the face of it China can hardly object to bilateral cooperative arrangements that promote broad based economic relations and thus contribute to regional peace, cooperation, prosperity and development. The most sensitive issue co ncerns bilateral defense and security cooperation. The Comprehensive Partnership agreement does not include any current or planned bilateral security cooperation that threatens Chinese interests in Southeast Asia. In fact, China and Vietnam, and the U.S and Vietnam, conduct bilateral high-level strategic defense dialogues. Both China and the U.S. make ship visits to Vietnam, and both cooperate with Vietnam in search and rescue. The U.S. will step up its assistance to Vietnam to enable it to contribute to UN peacekeeping by 2014; China is a major contributor to UN peacekeeping. My final assessment is that China cannot publicly criticize Vietnam for developing defense ties with the United States that China also does with Vietnam. China, which states it upholds non-interference in the internal affairs of other countries, will have to respect Vietnams decision to develop defense and security ties with the U.S. More subtly, China will conclude that if it exerts too much diplomatic pressure on Vietnam it could be counter-productive. In other words, as long as Vietnam develops even-handed defense and security ties with the major powers and does not ally with one against the other, China will have to manage its relations with Vietnam with care.

Suggested citation: Carlyle A. Thayer, Vietnam: Assessing President Truong Tan Sangs Visit to the United States 5 , Thayer Consultancy Background Brief, July 29, 2013. All background briefs are posted on Scribd.com (search for Thayer). To remove yourself from the mailing list type UNSUBSCRIBE in the Subject heading and hit the Reply key. Thayer Consultancy provides political analysis of current regional security issues and other research support to selected clients. Thayer Consultancy was officially registered as a small business in Australia in 2002.

Thayer Consultancy
ABN # 65 648 097 123

Background Briefing: Vietnam: Assessing President Truong Tan Sangs Visit to the United States - 6 Carlyle A. Thayer July 29, 2013

[client name deleted] Q1. What is your assessment of President Truong Tan Sangs visit to the U.S.? ANSWER: The most important outcome of President Truong Tan Sangs visit to the United States was the fact of the visit itself. It ended a five-year hiatus in high-level contacts. In fact, if normal protocol was observed, it should have been President Obama coming to Hanoi to reciprocate President Nguyen Minh Triets 2007 visit to Washington. President Sangs visit demonstrated that despite disagreement over human rights the two sides could advance their bilateral relations. Prior to President Sangs visit the U.S. insisted that demonstrable progress take place on human rights before there could be progress on the Trans-Pacific Partnership (TPP). Yet President Sang visited Washington and the two sides reaffirmed their commitment to conclude a high-standard TPP by the end of this year without any improvement in Vietnam s human rights situation. Q2. How do you assess the outcome of the Obama-Sang meeting? What did Vietnam achieve and what did the United States achieve? Was the presidential meeting a success? ANSWER: President Sangs visit was a personal success because of the adroit manner in which he handled human rights questions. President Sang met this issue directly and stated that differences were normal but that Vietnam was willing to discuss sensitive issues. President Sang took the initiative in bringing with him religious dignitaries from Vietnam to discuss religious freedom issues with U.S. Congressmen and Senators. The Comprehensive Partnership agreement included a trade-off, the two sides would protect and promote human rights (the U.S. position) and the two sides would cooperate to address war legacies issues such as unexploded ordnance and Agent Orange (the Vietnamese position). President Sang handled his public engagements quite well. His address at the Center for Strategic and International Studies (CSIS) was well received. He was direct in his answers to questions including his criticism of Chinas 9-dash line claim to the South China Sea.

2 President Sangs visit was successful for both sides on two accounts. First, the TPP is a high priority for the Obama Administration as it seeks to revive the economy and create jobs for American workers by exporting abroad. The U.S. wants a TPP for the economic benefits, but it also wants the TPP to demonstrate that its policy of rebalancing has other components that just military. Vietnam also needs a successful TPP in order to open up opportunities to step up economic growth. Second, both sides were able to demonstrate a convergence of interests on the South China Sea. The two presidents supported international law, including UNCLOS, the non-use of force or threat of force to settle territorial disputes, the full implementation of the Declaration on Conduct of Parties in the South China Sea (DOC) and commencing negotiations on a Code of Conduct (COC). Q3. Some analysts have concluded that because there was no formal agreement signed during President Sangs visit to the United States Vietnam got very little from this meeting. What is your assessment? ANSWER: The only agreement reached was the unsigned declaration of a Comprehensive Partnership. This contained three important elements. First, both sides agreed to create a new high-level political-diplomatic mechanism. This means regular meetings between Vietnams Foreign Minister and the U.S. Secretary of State. Second, both sides agreed to create new mechanisms for cooperation in nine areas: political and diplomatic relations; trade and economic ties; science and technology; education and training; environment and health; war legacy issues; defense and security; protection and promotion of human rights; and culture, sports and tourism. Third, the Comprehensive Partnership agreement specifically referred to Exim-Import Banks support for trade and investment in Vietnams oil and gas sectors and cooperation between U.S. companies Exxon Mobile and Murphy Oil with PetroVietnam. This raises the importance of U.S. protection for these companies to engage in unimpeded commercial activities in the South China Sea. This should be a deterrent to renewed Chinese assertiveness. Vietnam benefits because a more stable and secure environment in the South China Sea will enable Vietnam to exploit its energy resources for national development. Q4. What has been the response from China from its officials and from its experts? ANSWER: China has kept a relatively low media profile on President Sangs visit in its English and other foreign language reporting. The China Daily and Radio China International (in multiple foreign languages) provided a factual account of President Sangs meeting with President Obama. So far there have been no negative editorial comments in the Chinese media. Thayer Consultancy Background Briefs previewing President Sangs visit to the United States were sent to a wide selection of Chinese academic contacts. No critical comments were received.

Suggested citation: Carlyle A. Thayer, Vietnam: Assessing President Truong Tan Sangs Visit to the United States - 6, Thayer Consultancy Background Brief, July 29,

3 2013. All background briefs are posted on Scribd.com (search for Thayer). To remove yourself from the mailing list type UNSUBSCRIBE in the Subject heading and hit the Reply key. Thayer Consultancy provides political analysis of current regional security issues and other research support to selected clients. Thayer Consultancy was officially registered as a small business in Australia in 2002.