VIETNAM’s new leader, To Lam, has made China the destination for his first overseas visit, where he met with China’s President Xi Jinping.

This visit signals that China remains a vital power in Vietnam’s policy calculations, particularly in supply chain and economic dimensions.

Lam’s choice to visit China first since his appointment underscores Vietnam’s commitment to its relationship with China, even as Washington intensifies its courtship of Hanoi in response to recent visits by Xi and Russian President Vladimir Putin.

US President Joe Biden’s visit to Hanoi last year also marked an escalation in US overtures, aiming to ensure Vietnam remains a reliable supporter in Washington’s quest to defend the rules-based international order.

Vietnam seeks greater access to the Chinese market, especially for its agricultural products and high-quality investments, while China views Vietnam as geopolitically significant and aims to maintain a stable neighbour on its southern flank.

Vietnam’s new economic potential, including its vast reserves of critical minerals such as rare earths and the risk of Vietnam aligning more closely with Washington and the West, are key factors in this dynamic.

The leaders are also expected to accelerate plans for the construction of high-speed railway lines connecting China to Hanoi and key port cities.

Vietnam aims to complete two high-speed rail projects by 2030 as part of its efforts to modernise its ageing transport network and bolster trade with its northern neighbour.

These projects are integral to the Pan-Asia railway network, providing both economic and trade benefits, as well as strategic fallback options in the event of a conflict, whether maritime or on land.

During crises, the movement of military support, including troops, assets and food remains critical, and these rail links offer added logistical options and support systems.

China is Vietnam’s largest trading partner, with bilateral trade amounting to US$173.3 billion (RM758 billion) last year.

However, Vietnam’s exports to China are less than half the value of its imports, highlighting its heavy reliance on Chinese goods.

Lam’s visit will be closely watched by the Vietnamese public, which harbours deep mistrust of China due to centuries of conflict.

The new Chinese presence in Vietnam’s railway sector may further jeopardise Hanoi’s strategic advantage.

Russia’s efforts to diversify its sources of support beyond a China-centric approach, including overtures to North Korea and Vietnam, and consolidating ties with India and other regional powers, indicate that Vietnam must also be cautious about becoming overly dependent on China’s economic influence.

While Vietnam continues to hedge its bets, and balance its relations with both Washington and Beijing, the prospect of a full-blown conflict in the South China Sea or Taiwan Strait could complicate Vietnam’s position and its consequences.

Rare earths advantage

Vietnam has the second-largest rare-earth deposits, according to the US Geological Survey.

However, these resources have remained largely untapped, with investment discouraged by low prices, which are effectively controlled by China due to its near-monopoly on the global market.

The plans to restart Vietnam’s biggest rare-earth mine with a Western-backed project are part of a broader effort to challenge China’s dominance in the sector.

The Dong Pao mine, which has sat dormant for years, represents a significant opportunity.

Effective exploitation of this mine could elevate Vietnam to the top tier of rare-earth producers.

However, the subsequent steps, particularly refining and processing, remain complex, with China still controlling much of the necessary technology.

If extraction targets are met, Dong Pao’s output would rank just below that of California’s Mountain Pass, one of the world’s largest rare-earth mines.

During Biden’s visit, Washington agreed to assist Vietnam in better mapping its rare-earth resources and attracting quality investment, paving the way for new US investors to help develop this critical industry in the country.

Pushing factors for the US

Hanoi will play a critical role in supporting Washington’s efforts to deter Beijing’s militarisation of the South China Sea.

Potential future bases in Vietnam would be strategically important, providing critical support to existing bases in the Philippines and linking up with support bases in Singapore.

This would help counterbalance any strategic advantages China might gain from its use of the Ream port in Cambodia.

Vietnam could also serve as a vital vanguard against Beijing, helping to prevent further Chinese dominance in Southeast Asia, particularly in the Mekong region.

Additionally, Vietnam’s partnership would bolster US efforts to secure greater food security, maintain a stable supply chain and provide a reliable platform for trade and investment as more top firms exit China.

For US companies, Vietnam represents a stable economic platform, offering a critical fallback option in response to China’s economic decline.

Enhancing public narrative and soft power

Leveraging its legacy and experience of war, Vietnam is well-positioned to elevate its role as a responsible, effective and important power on both regional and global scales, promoting peace and cooperation.

Recognising the importance of rebuilding trust in an era marked by a trust deficit, Vietnam seeks to promote a common sense of responsibility, solidarity and cooperation.

Focusing on a people-centred approach, Vietnam acknowledges the significance of human capital and talent, as well as the mobility of knowledge and skills in driving national development.

Hanoi understands that its greatest asset is its people, with a demographic advantage that includes a large, young population poised to contribute to the nation’s future productivity and strength.

Vietnam’s foreign policy of independence, self-reliance, multilateralism and diversification — emphasising being a good friend and trustworthy partner to all countries and a proactive, responsible member of the international community — sends a clear message to Asean, China and the West.

While Vietnam seeks to leverage the strengths of each, it has the self-reliance to avoid becoming overly dependent on any single power.

Vietnam still holds valuable assets, resources and strategic potential, which it can use to wield influence over both China and the West.

By maintaining its stance of neutrality, independence and self-reliance, Vietnam can resist pressure from China while also managing Washington’s overtures.

This approach will enhance Hanoi’s leverage and bargaining power in regional influence, particularly in trade, economic and investment domains as well as in talent attraction, manufacturing and critical sectors such as food security.

Collins Chong Yew Keat is a foreign affairs, strategy and security analyst at Universiti Malaya. Comments: letters@thesundaily.com