Xi Jinping in Hanoi: Courting for a Common Destiny?

On December 12, Chinese President Xi Jinping made his third visit to Hanoi, and his first since 2017. As Vietnam’s “Bamboo diplomacy” in 2023 saw it upgrade ties with China’s global and regional rivals, namely the U.S. and Japan, Beijing wants reassurance from Hanoi that it is not joining the other side of the great power competition to gang up against China.

This occasion also presented an opportunity for Beijing to draw Vietnam closer into its sphere of influence, especially through initiatives like the “Community of Common Destiny” (CCD), Xi Jinping’s pivotal idea to reshape the existing global order. Vietnam was one of the few Southeast Asia countries which resisted inclusion in this initiative — until this visit. In Hanoi,  both sides agreed to build a “China – Vietnam Community with Shared Future” which will open a “New Era” of bilateral cooperation. There is a nuanced change from “Destiny” to “Future,” likely to mitigate potential public backlash in a nation where anti-China sentiment remains prevalent. The signing of a whopping 36 bilateral agreements indicates a successful diplomatic maneuver by President Xi.

Having Vietnam as a signatory to CCD carries strategic significance for China. Despite extensive efforts to bolster its global image, Beijing has struggled to establish a robust network of international partnerships. Beijing feels compelled to set an example in Vietnam on the “new type of international relations” it offers. If it cannot convince neighbouring and ideologically aligned Vietnam, how can it convince others? In an op-ed on the Communist Party of Vietnam (CPV)’s mouthpiece before his visit, President Xi said the participation of Vietnam will attract “many more countries” to join in. This is even more important given China’s recent escalation of tension in the South China Sea with the Philippines and the ongoing difficulties in progressing the Code of Conduct negotiations.

Vietnam’s assent to the “Community with a Shared Future” does not equate to a wholesale acceptance of China’s worldview.

Economically, Beijing also wants to strengthen ties with Vietnam. First, it wants to integrate Vietnam into its economic ecosystem, particularly by linking Vietnam with its southern industrial hub through the “Two Corridors, One Belt” framework. The “two corridors” in the framework refer to the economic routes linking the northern Vietnamese provinces of Lao Cai, Hanoi, Haiphong, and Lang Son with the southern Chinese cities of Nanning and Kunming. Meanwhile, the ‘one belt’ denotes the economic zone encompassing the Gulf of Tonkin’s rim. The proposed railway projects linking Northern Vietnam with Southern China reflect this idea. Second, Vietnam’s warm relationship with Western partners potentially offers Chinese enterprises a buffer zone amid the West’s de-risking policies that penalize doing business with China-based entities. This explains the sharp increase in China’s investment in Vietnam over the past two years. By November 2023, China had become the biggest investor in Vietnam in terms of newly registered projects.

Additionally, China positions itself as a direct competitor to Western partnerships by offering cooperation in new drivers of growth in Vietnam such as rare earth exploitation, innovation, and green energy transition (cooperation in these sectors was extensively discussed during the U.S. President Joe Biden’s trip to Hanoi three months ago). President Xi’s approach underscores a compelling proposition: China is not only able to match the offerings of Western partners but can do so at a more competitive price, as committed in the third Belt Road Initiative Forum last October.

Hanoi is receptive to Chinese offers due to several reasons. First, Vietnam wants a strong relationship with China as much as Beijing does. China is Vietnam’s most important economic partner, not just because it is the country’s biggest trade partner and the second biggest export market after the U.S. Vietnam is hugely dependent on Chinese imports for its manufacturing industry, while half of its agricultural exports goes to China. Second, as both countries share the ideological alignment, there are good reasons for Vietnam to forge strong political ties with China for the common goal of ensuring regime security. Third, Hanoi knows well that its balanced approach in the great power competition is essential for retaining its geopolitical leverage as a “swing state” in Asia. Having a warm relationship with Beijing is vital toward that objective.

Vietnam’s assent to the “Community with a Shared Future” does not equate to a wholesale acceptance of China’s worldview. Hanoi is more interested in maintaining the current rules-based international order rather than jumping into a China-led one, where it may be disadvantaged in negotiating tricky issues with China and where no one can enforce China’s adherence to the rules, such as the South China Sea dispute. Furthermore, Vietnam is also concerned about being over-dependent on China, which explains why it has been cautious in receiving big Belt Road Initiative projects, unlike other Southeast Asian countries. Hanoi wants to leverage its advantageous geopolitical position to develop a high-tech, high value-added economy where it could position itself as an independent economic hub instead of being over-reliant on a single market. This is obvious in Vietnam’s recent diplomatic upgrades with the U.S. and Japan, which have emphasized economic interests and downplayed geopolitical tensions.

As such, while Vietnam embraces China’s economic and trade proposals, it will remain cautious to join China-led political initiatives. Despite big announcements in Hanoi, Xi’s trip is unlikely to change the direction of Vietnam’s foreign policy, which continues to strike a delicate balance between China and the West.  

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