Thayer Consultancy Background Briefing:

ABN # 65 648 097 123

South China Sea: The China-
Vietnam-United States Triangle
Carlyle A. Thayer
August 6, 2019

Q1. A couple days ago, you sent out a tweet saying that ‘’Latest report yesterday was
that earlier figure of 35 Chinese vessels of [all] types at Vanguard Bank peaked at
near[l]y 80.’’ Can you provide the basis/or source of this estimate?
ANSWER: On 1 August I was given a six-page backgrounder by an official of Vietnam’s
government that stated, “China is deploying a large fleet of Coast Guard, fishing,
transport and towing vessels to escort the Haiyang Dizhi 8. The number of escorting
vessels were 35 at its peak.” My second source for the higher figure of 80 vessels of
all types wishes to remain anonymous.
Q2. Since your last Background Brief on 17 July a lot has changed. Vietnam has been
allowing the media to report about the Vanguard Bank standoff and publicly
demanded China to withdraw from its its Exclusive Economic Zone.The U.S. has
spoken up about the conflicts in the South China Sea, and Vietnam has also just signed
a defence agreement with the EU. What is your assessment of the relationship
between China and Vietnam at the moment?
ANSWER: While both China and Vietnam bicker over respecting their sovereign rights,
both sides have also held out the prospect of settling the matter through negotiations.
On 12 July, Geng Sheng, spokesperson for China’s Ministry of Foreign Affairs, stated,
“But we are also committed to managing our differences through negotiations with
relevant countries.” Vietnam, in a privately circulated backgrounder received 1
August, stated, “Vietnam attaches importance to both our relations with China and
the maintenance of a peaceful and stable environment for national development.”
In July, when China precipitated the current standoff, two members of the Vietnam
Communist Party (VCP) Politburo were in China, Nguyen Thi Kim Ngan, chair of the
National Assembly, and Vo Van Thuong, head of the VCP Central Commission on
Communication and Education. Both raised the South China Sea issue with their
respective hosts while also stressing the importance of bilateral relations.
Vietnam’s Deputy Prime Minister and Foreign Minister Pham Binh Minh raised the
South China Sea issue with China’s Foreign Minister Wang Yi when they met in
Bangkok for the annual meeting of ASEAN foreign ministers.
Bilateral relations are obviously strained but both parties appear to be restrained in
their actions at Vanguard Bank. At the same time, this dispute is being
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internationalized as more members of the international community criticize China and

offer support for Vietnam.
Q3. Vietnam so far has taken a very firm position in defending its sovereignty rights in
the South China Sea, but China has not budged. On the contrary, China seems to have
escalated the situation by bringing more vessels into the contested area. What do you
think the possible outcome of this standoff will be?
ANSWER: This standoff is likely to be resolved by one side sending a special envoy to
the other side to work out a practical solution. China could suddenly withdraw the
Haiyang Dizhi 8 and its escort vessels to undercut those in Vietnam advocating closer
relations with the United States, just as China withdrew the Hai Yang Shi You 981 from
Vietnam’s Exclusive Economic Zone in 2014 to undercut party officials calling for
Vietnam to exit China’s orbit (thoát Trung) and move closer to the U.S.
Q4. Do you think the current so-called ‘’China-Vietnam-U.S. triangle’’ will
continue? Today, the US sent the USS Ronald Reagan, one of its largest aircraft
carriers into Philippine waters, after U.S. Defense Secretary Mark Esper accused China
of destabilizing the Indo-Pacific. Things seem more tense now than ever. What do you
see eventually happening?
ANSWER: The maritime dispute between Vietnam and China has now been drawn
into the vortex of the larger strategic rivalry between the United States and China.
Vietnam has called for support from the international community and the United
States has responded with a ringing condemnation of China’s threat to regional energy
security and bullying. These remarks have been amplified by Secretary of State Mike
Pompeo and Secretary of Defense Mark Esper at the ASEAN-related meetings in
Bangkok, including the Trilateral Dialogue between the U.S. Japan and Australia, and
at the annual Australia-United States ministerial talks in Sydney.
Tensions between the United States and China over tariffs, and now currency
manipulation, have been exacerbated by U.S. arms sales to Taiwan and military muscle
flexing by China and the U.S. in the South China Sea. These tensions are likely to persist
for some time.
Q5. Many argue that now is the time for Vietnam to agree to a strategic relationship
with the U.S.? Do you agree with this assessment? Is this advantageous for Vietnam
to do so? And how should Vietnam deal with its ‘Three Nos Defense policy’ in the
event it wants to form a strategic relationship with the U.S.?
ANSWER: The Trump Administration identified Vietnam as a potential strategic
partner in its National Security Strategy and National Defense Strategy. This objective
was reiterated in its recent Indo-Pacific Strategy.
Since May, I have received private reports that the United States has approached
Vietnam and asked them to consider raising bilateral relations from a comprehensive
partnership to a strategic partnership. This idea in not new, it was raised by Secretary
of State Hillary Clinton when she was in office. Eventually both Hanoi and Washington
decided the time was not ripe.
Vietnam first began to organize its relations with the major powers with agreements
on strategic partnerships in 2001. At present Vietnam has sixteen strategic partners –
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Russia (2001), India (2007), China (2008), Japan and the Republic of Korea and Spain
(2009), the UK (2010), Germany and Italy (2011), Singapore, Thailand, Indonesia and
France (2013), Malaysia and the Philippines (2015), and Australia (2018) – and twelve
comprehensive partners – South Africa (2004), Chile, Brazil and Venezuela (2007),
New Zealand (2009), Argentina (2010), Ukraine (2011), the U.S. and Denmark (2013),
Myanmar (2017), Hungary (2018), and Brunei (2019).
Vietnam’s strategic partnerships are broad-based agreements to cooperate in a
number of areas such as diplomacy and political relations, economic relations,
education, science and technology, labour, social affairs, culture, people-to-people
exchanges, and regional and international cooperation. Defence, security and
intelligence cooperation form only one part of this larger framework.
The U.S. concept of a strategic partner is much more narrowly focused on defence and
security cooperation than Vietnam’s more expansive concept of strategic partner.
China’s intimidation and coercive actions at Vanguard Bank increase the likelihood
that the U.S. and Vietnam will raise bilateral relations to a strategic partnership. But
other issues than China are also involved. The U.S. maintains tariffs on Vietnamese
exports of catfish, shrimp, and aluminum and steel. U.S. trade officials have
threatened to designate Vietnam a currency manipulator. Vietnam is subject to
possible sanctions under the Countering America’s Adversaries Through Sanctions Act
through its purchases of weapons from Russia.
Vietnam’s long-standing declaratory defence policy of “three no’s” was spelled out in
its 2009 in its most recent Defence White Paper: “Vietnam consistently advocates
neither joining any military alliances nor giving any other countries permission to have
military bases or use its soil to carry out military activities against other countries.”
The “three no’s” does not preclude stepped up military cooperation with the United
States under the framework of a strategic partnership, especially if such cooperation
is designed to improve Vietnam’s capacity for self-defence.
Q6. What do you think is the significance of Vietnam signing a defence agreement with
the EU?
ANSWER: The EU-Vietnam defence agreement is a logical corollary to the recent
agreements on trade and investment between the EU and Vietnam. Vietnam is the
EU’s preferred entryway into Southeast Asia. Vietnam will assume the ASEAN Chair in
2020 and become a non-permanent member of the UN Security Council the year after.
The EU-Vietnam agreement also reflects Vietnam’s growing defence cooperation with
the EU, including UN peacekeeping. Five EU members have already signed agreements
on strategic partnership with Vietnam, four of which include cooperation on security
and defence – France, Germany, Italy and the United Kingdom. Last year, Vietnam
attended the meeting of the EU’s Military Committee for the first time.
Q7. FOLLOWUP: In your answer to questions 5, we would like to confirm that you do
think there are benefits for Vietnam to become a strategic partner with the US.
ANSWER: Yes, there are benefits for Vietnam across the range of areas of cooperation
in the comprehensive partnership that would be expanded in a strategic partnership.
A strategic partnership usually entails drawing up a multiyear Plan of Action. Vietnam
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could receive assistance in areas that help with market reform. But his has to be
balanced by resolution of a number of outstanding issues. (tariffs, potential CAATSA
sanctions) and overcoming Vietnam's fear of "entrapment", that is, getting drawn into
an anti-China position that would reduce its freedom of action towards Beijing.

Media Identification: The University of New South Wales, Canberra or The University
of New South Wales at the Australian Defence Force Academy, Canberra.
Suggested citation: Carlyle A. Thayer, “South China Sea: The China-Vietnam-United
States Triangle,” Thayer Consultancy Background Brief, August 6, 2019. All background
briefs are posted on Scribd.com (search for Thayer). To remove yourself from the
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Thayer Consultancy provides political analysis of current regional security issues and
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