Uncle Joe Meets Uncle Ho

President Biden and General Secretary Nguyen Phu Trong of the Communist Party of Vietnam met in early September and initiatied a "Comprehensive Strategic Partnership," a status Vietnam reserves for its closest partners, emphasizing peace, cooperation, and sustainable development.

The Socialist Republic of Vietnam remains categorized as a "non-market economy," and is treated less favorably under US anti-dumping law.  Removal of this designation is a priority ask from Hanoi, although it hasn't materially slowed growth in exports to the US.   Following the upgrade of bilateral relations, the Biden Administration has committed to “expeditiously” review Vietnam’s nonmarket economy designation under U.S. trade law.

Twenty years ago the NME designation was prompted by concerns about  protecting America's catfish farmers [68 FR 37116].  Today Vietnam is our fifth largest source of foreign goods, with US Imports from Vietnam only slightly less than those from Japan.

Exports from the US are modest, barely more than those to Indonesia, making Vietnam the trading partner with the third largest trade deficit, after China and Mexico.

The Leaders Joint Statement can be found [here], below a summary:

Economic, Trade, and Investment Cooperation

• Emphasis on enhancing economic cooperation and fostering inclusive growth.
• Commitment to facilitate market access and address trade barriers.
• United States to review Vietnam's market economy status request promptly.
• Efforts to bolster a rules-based multilateral trading system with the World Trade Organization at its core.
• Acceleration of cooperation in labor rights and intellectual property, with potential amendments to the U.S.-Vietnam Air Transport Agreement.
• Focus on infrastructure development, agriculture, and participation in global supply chains, with special emphasis on the Mekong Delta region.

Science, Technology, Innovation, and Digital Cooperation

• Agreement to strengthen cooperation in science and technology.
• Focus on enhancing Vietnam's position in the global semiconductor supply chain.
• Promotion of secure digital infrastructure in Vietnam to foster digital economy growth.
• Collaboration between top academic institutions in STEM fields.

Education and Training Cooperation

• U.S. to assist in training a high-quality Vietnamese workforce.
• Encouragement of educational exchange programs and acknowledging the role of Fulbright University Vietnam.

Climate, Energy, Environment, and Health Cooperation

• Collaboration in climate change adaptation, pollution reduction, and renewable energy integration.
• Acknowledgment of Vietnam's commitments to the Just Energy Transition Partnership and its 2050 net zero emissions target.
• Enhancement of health security collaboration, including efforts to control HIV/AIDS and tuberculosis.
• Support for the expansion of Vietnam's domestic pharmaceutical sector.

Defense and Security

• Appreciation for Vietnam's contributions to global peace and stability.
• Agreement to strengthen cooperation in various areas including maritime security and countering transnational crimes.
• Commitment to deepen defense trade and industry cooperation, with discussions reportedly underway to sell the Vietnamese Air Force F-16 Aircraft. The sale of F-16s, developed by Lockheed Martin, to Vietnam would be significant, as the Vietnamese Air Force has traditionally operated Russian-made fighters such as the Su-30, Su-27, and Su-22.

Promotion and Protection of Human Rights

• Affirmation of the importance of promoting and protecting human rights.
• Commitment to fostering dialogues to strengthen mutual understanding and promote human rights.

Coordination on Regional and Global Issues

• Intention to enhance collaboration on regional and global concerns to maintain peace, stability, and development globally.

Industry Summit Showcases Investment

During the Vietnam-US Innovation and Investment Summit on Monday, executives from Google, Intel, Amkor, Marvell, GlobalFoundries, and Boeing forged collaborative agreements, expected to trigger a wave of US investments in Vietnam.  A previously announced $1.6 billion Amkor semiconductor facility near Hanoi is scheduled to commence operations in October, and Boeing announced the sale of 50 jets to Vietnam Airlines.

Additionally, Vietnamese company AMI AC Renewables and US industrial group Honeywell have partnered to create Vietnam's first battery energy storage system in Khánh Hòa province. 

Hill Applauds Viet Strategic Partnership

House Foreign Affairs Chairman Michael McCaul acknowledged the elevation of the US-Vietnam relationship to a Comprehensive Strategic Partnership, a status Vietnam reserves for its closest partners, as a parry to China's flank.

"The signing of a ‘Comprehensive Strategic Partnership’ agreement between the United States and Vietnam will only strengthen deterrence against the growing aggression of China in the Indo-Pacific. This partnership represents a new chapter in U.S.— Vietnam relations and is an important step in maintaining regional security and the global balance of power."

Ranking Member of the House Foreign Affairs Committee Gregory Meeks, and Ami Bera, Ranking Member of the Subcommittee on the Indo-Pacific, issued a more nuanced welcome to the news:

"Coming ten years after the formulation of our Comprehensive Partnership in 2013, the strengthening of our relationship represents a new chapter in U.S.-Vietnam ties...We welcome steps announced today to bolster bilateral science and technology cooperation, including on semiconductors, and look forward to working with Vietnam to promote human rights and the rule of law, as well as maintain peace, stability, and respect for international law in the South China Sea and the broader Indo-Pacific."