Potential opportunities and existing challenges

In 2014, we witnessed unpredictable developments, leaving profound implications in all fields and all continents. Optimism about the world economic recovery was overruled by worries when growth stalled, and there were signs of new recession in some of big economies. (1) It is noticeable that global oil prices dropped by 50% since 2014 partially due to, on the one hand, slower global economic recovery than projected, and on the other hand, oil/gas production by hydraulic fracturing technology is about to redraw world energy map, hence deep geostrategic implications. Given economic difficulties in many countries, the trend of protectionism has increased, regional economic linkage initiatives have been launched. However, they are more of an attempt to rally forces for big power strategic competition.

Beside the grey economic picture, looking at 2014 from political and security perspectives, the world was unstable with higher tensions than 2013 when “hot spots” in the world heated up. In the Middle East and Africa, while there was no sign of way out for the Palestinian-Israeli crisis and the “Arab spring”, came the self-styled “Islamic State” in Syria and Iraq and Ebola outbreak in Africa.

It is beyond imagination that guns were heard in Europe again when the crisis in Ukraine turned a peaceful country into a battle field of big power strategic competition which made people think of the “ghosts” of a “new cold war” or “a cold peace.” In East Asia, never before did both tensions and threats of conflicts loom so large in the East Sea and the East China Sea as in 2014. Structural clashes became more obvious; regional state of affairs seemed to be rearranged, signaling a new unstable period.

Big countries stepped up both cooperation and fight in a more complicated tendency, putting the international political and security situation at stake and unpredictable. The China-US relations continued to be an important factor that shaped the state of affairs in Asia-Pacific. It is noticeable that in the past years, there were tensions in several aspects in the China-US relations, particularly in regional security. However, never before, did the deep interrelation in economy, finance, trade and investment between China and the US can make the two countries reach important agreements like in 2014. (2) Japan’s proactive participation in regional and international affairs accelerated the Japan-China strategic competition. The aggravated relations between Russia and the US and the EU due to the Ukrainian crisis led to economic sanction and diplomatic isolation. To oppose pressure from the US and Western countries, Russia strengthened its partnership with China, adopting “look east” policy and consolidating its relations with Latin American countries.

The above-mentioned clashes and conflicts are converging in Asia-Pacific. The region has continued confirming its role as a driving force for global economic growth and also a key hub of strategic competition among big powers. Despite the common aspiration of countries for peace, cooperation and development, the security environment in the Asia-Pacific region in 2014 were complicated because of: 1. Increasing strategic competition among big powers, 2. Serious lack of strategic trust among big powers as well as between small countries and big powers due to actions of great power politics, 3. Disputes over territorial waters and island sovereignty which instigated nationalism, and eroded trust in multilateral cooperation entities, 4. The aggravated situation in the East Sea due to China’s ambition to realize the “nine-dotted line” on the sea. (3)

In the grey picture of the world and region, ASEAN stood out as a bright spot. According to the International Monetary Fund (IMF), in 2014, ASEAN achieved an average economic growth of 4.6%; and the ASEAN5 (Indonesia, Malaysia, Singapore, Philippines and Viet Nam) recorded 4.7% growth, higher than the average rate of the world. Despites challenges, ASEAN maintained unity and consensus, stepping up connectivity and continuing to build the ASEAN community in 2015, and promoting its central role in the regional architecture. Relations between ASEAN and partners and dialogue partners were consolidated.

In general, changes in the world and region, especially complicated developments in the relations of big powers had deep impacts on security environment and development of Viet Nam. Challenges came from all sides. In territorial sovereignty, Viet Nam’s legitimate rights and interests in the East Sea were violated. In security, some forces were staging intervention under the guise of “democracy,” “human rights,” and “peaceful evolution.” As near to home, political opportunists and extremists capitalized on international developments to cause instability and chaos. In economy, in addition to fiercer trade competition, Viet Nam met with numerous difficulties due to instability in the region and the world.

Achievements in foreign affairs of the Party and State of Viet Nam

Amid complicated and unexpected developments in the world and region, we were fully aware of mixed opportunities and challenges with the latter more prominent due the increasingly tense situation in the East Sea and its comprehensive impacts on peace, security and development of Viet Nam. On the basis of full knowledge of opportunities and challenges, Viet Nam identified primary foreign affair tasks in 2014, including fully grasping all opportunities, overcoming challenges, maintaining peaceful and stable environment, mobilizing external resources to complete development goals, restructuring the market and thus contributing to sustainable development of the country. To fulfill these tasks, we focused foreign affairs on effectively developing relations with other countries, deepening comprehensive international integration, synchronously and comprehensively strengthening bilateral and multilateral relations, firmly defending national independence, sovereignty and territorial integrity, enhancing Viet Nam’s position and making positive contribution to the struggle for peace, national independence and social progress in the world.

Effectively deepening relations with partners - a major focus of bilateral foreign relations in 2014.

If 2013 was marked by the establishment of framework strategic partnership and comprehensive strategic partnership with important countries, in 2014 these partnership agreements were implemented. Viet Nam strengthened its multilateral cooperation with neighboring countries, ASEAN member countries, strategic partners and comprehensive strategic partners, as well as traditional friendly countries, effectively handling cooperation and struggle, resolutely defending Viet Nam’s legitimate interests and consolidating friendship and cooperation with partners. Though the world economy and big economies met with difficulties, Viet Nam’s trade turnover, investment, and official development aid (ODA), tourism and labor cooperation with big partners such as China, the US, the EU and Japan were higher than the same periods of the previous year.

Relations between Viet Nam-Laos promoted cooperation in political, economic, national defense, security, cultural and educational and training fields; people exchanges were strengthened. In 2014, exchanged visits of Vice Minister level upward accounted for 160. Viet Nam was one of the three largest trade partner and investor of Laos; annual trade turnover reached US$ 1.2 billion. Achievements recorded by the Summit of Cambodia-Laos-Viet Nam Development Triangle (CLV) organized in Vientiane in November 2014 facilitated cooperation in all fields, especially in strengthening association of the three economies of Viet Nam, Laos and Cambodia.

There were progresses in the relations between Viet Nam and Cambodia in economic, trade and education, among others. At the 4th Viet Nam-Cambodia Conference on Investment Cooperation and the 13th session of the Viet Nam-Cambodia Intergovernmental Committee, the two sides mapped out measures to effectively promote cooperation in several fields. Viet Nam was the second largest trade partner with total turnover of US$ 4 billion in 2014, and fifth largest investor with a total investment of US$ 3.6 billion in 134 projects. Nevertheless, some hostile organizations and forces waged demonstrations, causing disturbance and racial discrimination, allegation and distortion on historical issues, complicating the situation and affecting friendship between the two peoples.

Relations with ASEAN countries continued to develop along the line of unity, cooperation, establishment of ASEAN Community and maintain the central role of ASEAN in regional architecture. Economic and trade cooperation improved, trade turnover of Viet Nam with ASEAN member countries was estimated at US$ 40 billion. ASEAN’s Joint Declaration on the East Sea issued after 20 years of its establishment demonstrated the common desire of ASEAN member countries to turn Southeast Asia into a region of peace, stability, sustainability and prosperity. Bilateral relations between Viet Nam and ASEAN member countries continued deepening for mutual benefit. Viet Nam and Malaysia and the Philippines agreed to work towards establishing strategic partnership.

In the past year, relations between Viet Nam and China underwent complicated developments. Since January to May 2014, the relations developed well. However, China’s illegal position of its Haiyang Shiyou 981 in Viet Nam’s exclusive economic zone and continental shelf affected bilateral friendship and cooperation. In that context, the Vietnamese Party and State persistently held dialogues, revolved the situation by peaceful means by abiding with international law including the 1992 UN Convention on the Law of the Sea, Agreement on fundamental principles on the settlement of issues at sea between Viet Nam and China, and the Declaration on Conducts (DOC) of parties in the East Sea. Viet Nam’s legitimate stance was broadly supported by public opinions in the region and the world. Meanwhile, Viet Nam proactively maintained normal relations in all fields with China from exchange of visits at all levels, relations between ministries, branches and localities, people exchange, organization of the 7th Steering Committee on bilateral cooperation between Viet Nam and China, to normal economic, trade, investment and tourism activities with China. Annual trade turnover could reach US$ 60 billion. Tensions between the two countries eased after China withdrew its Haiyang Shiyou 981 oil rig; exchanges of visits at all levels continued; and economic and trade cooperation returned to normal. The two sides actively coordinated in celebrating the 65th anniversary of the establishment of diplomatic relations (January 18, 1950-January 18, 2015); facilitated exchanges of high-level visits of leaders in 2015; and enhanced efficiency of the Steering Committee of bilateral cooperation. All these confirm the consistent guidelines of the Party and State to attach importance to maintaining relations in all fields with China, meeting and aligning with aspirations of the two peoples.

Though Viet Nam-Russia relations were affected by the complicated situation in Ukraine and Western economic sanctions against Russia, Russia’s shifted its cooperation to Asia, created favorable condition for continued development of relations. Both sides took effective and practical measures to boost cooperation, maintained the comprehensive strategic partnership, increased exchanges of visits at all levels, strengthened cooperation in areas of mutual benefits including oil and gas, energy, security, national defense, technique and military equipment. Results of the official visit to Russia by Vietnamese Party General Secretary Nguyen Phu Trong in November 2014, meetings between Vietnamese President Truong Tan Sang and Russian President Putin on the sidelines of the 22nd Asia-Pacific Economic Cooperation Summit, between Vietnamese Prime Minister Nguyen Tan Dung and Russian Prime Minister D. Metvedev on the sidelines of the 25th ASEAN Summit constituted a driving force to deepen the comprehensive strategic partnership in the fields of oil and gas, energy, nuclear energy, education, security, and national defense. The two sides are striving to raise two-way trade turnover to US$ 7 billion in 2015 and US$ 10 billion in 2020. The two sides concluded negotiations on the Free Trade Agreement (FTA) between Viet Nam and the Customs Union of Russia-Belarus-Kazakhstan which will be signed in 2015, facilitating Viet Nam’s goods and agricultural products to enter the market of Russia and members of the Commonwealth of Independent States (SNG). We showed sympathy with and shared Russia’s difficulties due to falling oil prices and devaluation of the ruble, and were ready to coordinate with Russia to take practical measures in support of the Vietnamese community in Russia to stabilize their life and overcome difficulties caused by Russia’s troubled economy.

New developments in Viet Nam-Russia relations in the past year were based on the traditional friendship that bound the two countries, was tested and verified in the past period.

Relations between Viet Nam and India was further promoted through the visits to Viet Nam by Indian President and Foreign Minister and the visit to India by Vietnamese Prime Minister Nguyen Tan Dung. The two sides aimed to increase bilateral trade turnover to US$ 15 by 2020. India affirmed to provide Viet Nam a credit package of US$ 300 million to import raw materials for economic sectors, particularly textile and apparel and footwear. Positive progress was also made in the fields of security, national defense and oil and gas. India considered Viet Nam an important priority in its “look east” policy and committed to channel US$ 100 million in supply of new patrol boats to Viet Nam.

Relations between Viet Nam and Japan developed positively. During the official State visit to Japan of President Truong Tan Sang, the two sides agreed to upgrade bilateral relations to broad and comprehensive strategic partnership for peace and prosperity in Asia. Japan continued confirming its role as the primary important development partner and one of the biggest foreign investors in Viet Nam with a total prescribed capital of US$ 35.5 billion. Japan was also the biggest ODA provider, accounting for 30% of the total committed ODA of Viet Nam (ODA was estimated US$ 1.8 billion in 2014), the fourth largest trade partner and the second largest export market of Viet Nam. The two sides shared similar points of view in regional and international issues, especially the issue of ensuring peace, stability, freedom and navigation safety in the East Sea. At local level, cooperation and connectivity activities were also stepped up. In 2014, 20 localities of the two countries signed 10 agreements on sisterhood and cooperation (in 2014, the number was 8 localities); several groups of Japanese experts came to Viet Nam to assist farmer and fisherman households, transfer technologies of cultivation, production, preservation and processing to improve product quality, develop sea, agricultural and fishing economies.

Relations between Viet Nam and South Korea deepened. Results of the visit to South Korea of General Secretary Nguyen Phu Trong strengthened the strategic partnership, promoting closer cooperation in the fields of economy, finance, infrastructure development, national defense and banking. The signing of the Minute of negotiations on the FTA during the working visit to South Korea by Prime Minister Nguyen Tan Dung marked an important milestone in bilateral economic relations, ushering in more cooperation opportunities for businesses of the two countries. South Korea was the biggest foreign investor, the second ODA provider (committing US$ 1.2 billion for the period of 2012-2015), the fourth largest trade partner of Viet Nam with the trade turnover in 2014 (by the end of October) reached US$ 23.6 billion and expected US$ 70 billion in 2020. Cooperation in tourism, labor, education and training strongly developed.

The comprehensive strategic partnership of Viet Nam and the US continued developing in several fields. Preparations are being made for the 20th anniversary of the normalization of bilateral relations in 2015. The US was the seven largest investors in Viet Nam and the largest export market of Viet Nam with two-way trade turnover in 2014 estimated at US$ 34 billion. Political, diplomatic, national defense and security mechanisms contributed to promote mutual trust and understanding. Exchange of visits at Government and Parliament and even Party levels increased. Substantive cooperation progressed in security, national defense, economy, trade, education, science and technology; the US partially lifted its ban on the sale of lethal weapons to Viet Nam and adopted the Civilian Nuclear Cooperation (Section 123). In addition, Viet Nam was engaged in frank exchange and open dialogues with the US to minimize disputes, strengthen mutual understandings in issues of diverse viewpoints such as democracy, human rights and religion.

Relations between Viet Nam and the European Union (EU) and other important partners namely Germany, Britain, France, Belgium, Italy, the Netherlands, and Denmark continued developing. The EU was Viet Nam’s third largest trade partner and the second largest export market with turnover estimated US$ 35 billion in 2015. The EU committed to an increase of 400 million Euros as aid to Viet Nam in the period of 2014-2020. The two sides issued a Joint Statement on conclusion of the negotiations on the Viet Nam-EU Free Trade Agreement (EVFTA), agreeing to accelerate the ratification process of the Framework Agreement on Comprehensive Partnership and Cooperation (PCA).

Relations with traditional friendly countries and potential partners in Eastern Europe, Central Asia, the Middle East, Africa and Latin America were strengthened. Viet Nam capitalized on well-developed political relations with these countries to expand substantive and deeper cooperation to other fields, especially in economy, trade, education and training, labor in multilateral fora. Most of African and Latin-American countries actively supported Viet Nam in the United Nations, the UN Human Rights Council, and the UN Educational, Scientific and Cultural Organization (UNESCO). The trade turnover of Viet Nam with countries in West Asia and Africa was estimated at US$ 14 billion in 2014.

Proactive and creative multilateral diplomacy plays an increasingly important role in comprehensive international integration.

A salient point in foreign affairs in 2014 was efforts to elevate multilateral external relations. Viet Nam was striving to shift from “participating” to “proactively and actively making contribution, proposals and recommendations,” join in shaping common rules in international and regional fora, such as ASEAN, the Asia-Pacific Economic Forum (APEC), the Asia-Europe Meeting (ASEM), the Non-Aligned Movement, the UN Human Rights Council, UNESCO, and the International Atomic Energy Agency (IAEA). Foreign relation activities in international fora, especially multilateral relations of Viet Nam’s leaders contributed to consolidating and deepening bilateral relations and raising Viet Nam’s profile as a responsible member of the international community, mobilizing and winning public opinion’s support to Viet Nam’s stance on the East Sea issue. Viet Nam’s proposals and initiatives were shared and supported by countries. The unofficial ASEAN-EU Summit organized for the first time on the sidelines of the ASEM 10 initiated by Viet Nam created an important premise for ASEAN-EU dialogues and cooperation in the coming time. Viet Nam successfully assumed its role as a member of the UN Human Rights Council in the first year of its 2014-2016 term; The Universal Periodic Review (UPR) on human rights of Viet Nam was highly appreciated by members of the Council.

Attention was given to preparations for international integration with the organization for the first time the “Conference on multilateral diplomacy in the 21st century and policy recommendations for Vietnam” in August 2014. Ministries, branches and localities actively carried out review, revision and supplement of legal documents, enhanced integration capacity, trained staff and disseminated international integration efforts among the public and businesses. Besides, active preparations were made to ensure to the 132nd Assembly of the Inter-Parliamentary Union (IPU) as success and for the first time Viet Nam joined the UN Peacekeeping force. Through these activities, the multilateral diplomacy continued to be an important focus of modern diplomacy.

The important role of economic diplomacy in the period of broad and deep international integration.

Given slow recovery of the global economy, difficulties in Viet Nam’s economy, economic diplomacy was identified as a spearhead to be actively and proactively pushed forward. Foreign economic activities helped strengthen traditional markets, open potential markets, improve import and export, attract investment, technologies, assist businesses to seek partners, assess new markets, fight against protectionism, and lobby for international recognition of Viet Nam’s market economy. In 2014, another 12 countries (higher than 4 countries in 2013) recognized Viet Nam’s market economy, raising the total number to 56. Important results were achieved in FTA negotiations. Viet Nam concluded FTA negotiations with South Korea, the Customs Union of Russia-Belarus-Kazakhstan and agreed with EU for early conclusion of FTA negotiations for signing in 2015. Within the framework of ASEAN, Viet Nam was one of the drivers for building of the ASEAN Economic Community (AEC), taking 85% of measures as compared with the average rate of 80% of ASEAN.

In addition, the work of citizen protection and overseas Vietnamese was proactively, actively and timely implemented. More than 1,750 Vietnamese laborers were repatriated; fishermen were supported in their production in Viet Nam’s waters; necessary measures were taken to protect Vietnamese citizens and laborers working and living abroad in difficulties. Viet Nam continued to institutionalize and effectively implemented the Law on Vietnamese Nationality, Resolution 36-NQ/TW on overseas Vietnamese, dated 26 March, 2004 of the Politburo, consolidating people’s confidence in and support to the Party and State’s correct policies.

Maintaining peaceful environment, firmly safeguarding sovereignty, territorial integrity, legitimate rights and interests of Viet Nam in the East Sea – important achievements of the diplomatic, national defense and security coordination.

In response to great power politics, defiance of international law, and violations of national legitimate interests in the East Sea, Viet Nam resolutely struggled to firmly defend its sovereignty, sovereign rights and jurisdiction in the East Sea. Measures were synchronously and comprehensively taken in political, diplomatic, legal and communication fields. Priority was given to political diplomatic struggle to defend sea and island sovereignty. More than 40 meetings, contacts, telephone talks, and diplomatic exchanges with China were organized in different levels, branches, fora, and through channels of the Party, State, Parliament, Government and people from 2 May to 15 July at the time when China illegally positioned its Haiyang Shiyou 981 oil rig in Viet Nam’s exclusive economic zone and continental shelf. Viet Nam upheld legitimacy, resolutely struggled, mobilized and won world public opinion’s support and assistance against actions and violations of international law, contributing to maintain peace and stability in the region. In that struggle, Viet Nam persistently protected fishermen, ensured oil and gas and economic interests and strove to maintain stability in the East Sea. At the same time, Viet Nam proactively maintained relations with China to stabilize and step up cooperation on the basis of international law and bilateral agreements.

Important achievements in foreign affairs in 2014 demonstrated the dialectical relations of the correct foreign policy, the close leadership and guidance of Party, State, National Assembly and Government leaders, people’s support and international public opinion ,the close coordination among Party external relations, State diplomacy and people’s external relations, joint forces, unanimity of ministries, branches, and localities, especially among diplomacy, national defense and security.

Foreign relation orientation in 2015

The year 2015 is of important significance. It’s the key year to fulfill objectives and tasks set out by the 11th Party Congress, prepare for the 12th Party Congress and celebrate big anniversaries: the 85th founding anniversary of the Party, the 125th birth anniversary of President Ho Chi Minh, the 70th founding anniversary of Viet Nam, and the 40th anniversary of the liberation of the South and national unification. Complicated developments continue in regional and world situation. Unexpected and unpredictable elements will increase due to disputes over territorial sovereignty, resources, racial and religions conflicts, separatism, great power politics, attempts to use and threat to use force, changes of status quo in the region are potential in many places. Viet Nam’s sovereignty, territorial integrity, peaceful environment and security stand firm before be challenges. While forecast on the world economic prospects in 2015 may be more optimistic, there is no promise of strong recovery as big economies meet with difficulties; and there remain bottlenecks in oil prices, trade protectionism, discrimination in trade and trade disputes. Non-traditional issues, climate change, waters security, cybersecurity and Ebola outbreak are increasingly global challenges, requiring international community’s coordination and prevention. Amid this situation, foreign policy in 2015 focuses on the following major tasks:

First, continue to implement Resolution 22 of the Politburo on international integration and Resolution of the 8th Plenum of the Party Central Committee, 11th Tenure on Strategy on national defense in the new situation, and prepare quality inputs on foreign policy of the Party and State to the documents of the 12th Party Congress.

Second, continue effectively deepening partnership, particularly with neighboring countries, strategic partnership and comprehensive strategic partnership, strengthen trust and intermingle interests to maintain peaceful environment, stability and safeguard sovereignty and territorial integrity.

Third, actively and proactively push forward multilateral foreign relations, focusing on active participation in ASEAN activities, enhance Viet Nam’s position in the United Nations and other important international organizations and fora, successfully organize the 132th IPU Assembly in Ha Noi, actively prepare to host APEC Summit in 2017, and run for non-permanent membership of the UN Security Council for the 2020-2021 tenure.

Fourth, synchronously and comprehensively carry out activities in bilateral and multilateral relations, political, economic, and cultural diplomacy, work on overseas Vietnamese, citizen protection, external information and local foreign affairs, combining Party external relations, State diplomacy and people foreign relations and enhancing Viet Nam’s position and prestige in the world.

In 2014, Viet Nam achieved outstanding results in foreign relations, fulfilling tasks assigned by the Party and people, demonstrated a new posture in integration, actively contributed to national construction and defense in the new situation. With wisdom and acumen, Viet Nam succeeded in combining national strength to the strength of the times for national interests. Viet Nam confidently enters 2015 with a strong will to successfully implement the tasks set out by the 11th Party Congress, consolidating the foundation for effective realization of tasks mapped out by the 12th Party Congress in the process of broader and deeper international integration.

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(1) The World Bank (WB), the International Monetary Fund (IMF), the Organization of Economic Cooperation and Development (OECD) and the Asia Development Bank (ADB) forecast lower global economy growth compared with early months of the year. In October 2014, IMF projected the world economic growth at 3.3%, lower than 3.4% forecast in July 2014, that of the EU at 1.1%, the Asia-Pacific region at 6.2%, China at a lower figure of 7.4%, and Russia at 0.2%. Japan’s economy fell into recession again with continued GDP reduction in the second and third quarters. The American economic growth rate was higher than the forecast of 2% in early 2014, estimated at 2.2%.

(2) During the official visit to China of American President B. Obama in November 2014, the two sides reached agreements on cooperation in reponse to climate change, removal of tariffs on 250 high-tech products in alignment with WTO’s Information Technology Agreement (ITA), encouraged confidence-building measures, signed the Agreement on Establishing a Consultation Mechanism and set up a code of conducts on naval and air force safety

(3) China illegally positioned its Haiyang Shiyou 981 oil rig in Viet Nam’s exclusive economic zone and continental shelf, fortified and consolidated rock fields in Truong Sa.

The article was published on Communist Review No 868 (February 2015)