The U.S.-China Battle Complicates Vietnam's Economic Ambitions

Oct 22, 2018 | 10:00 GMT

A farmer works in a rice field on the outskirts of the central Vietnamese city of Hue on Jan. 17.

A farmer works in a rice field on the outskirts of the central Vietnamese city of Hue on Jan. 17. Vietnam is attempting to steer a path through the economic battle between China and the United States.



  • By amassing political power, Vietnamese General Secretary Nguyen Phu Trong has effectively overturned the collective leadership in his country's political system, but questions remain as to whether such a model can continue after a leadership transition in 2021.
  • The trade war between China and the United States could persuade some companies to relocate their high-end factories to Vietnam, yet the country's unskilled workforce and lower technological capacity will be a major weakness.
  • Vietnam has been relying on a diversification strategy to reduce its economic reliance on China, but heightened competition between Beijing and Washington could complicate Hanoi's balancing act.

Nguyen Phu Trong has emerged as an unlikely strongman. Widely regarded as a compromise figure when he became Vietnam's general secretary in 2011, the 74-year-old ideological hard-liner has quickly reshaped the balance of Vietnam politics since assuming the post of Communist Party chief. On Oct. 22, Vietnam's parliament will formally approve Trong's presidency, effectively breaking his long-espoused model of collective leadership to become the most powerful Vietnamese leader in recent decades. But unlike Chinese President Xi Jinping, Trong is far from a supreme leader; his advanced age almost certainly guarantees his retirement at the next party congress in 2021 -- a factor that also raises questions about his plan for succession and the sustainability of a more individualistic rule in what remains a factional political scene. For the moment, however, maintaining a mere grip on power is only half of Trong's task. Beyond that, Vietnam's leader will strive to mobilize...

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