US embassy cable - 05HANOI366

UNCLAS SECTION 01 OF 04 HANOI 000366 
 
SIPDIS 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: PREL, ETRD, PBTS, CH, VM, ARF, CVR, ASEAN 
SUBJECT:  NSC Senior Director Michael Green Discusses China 
with Senior Foreign Relations and Think Tank Officials 
 
Reftels: A. Hanoi 247 B. 04 Hanoi 2795 
 
1. (SBU) Summary: The complicated Vietnam-China relationship 
is at a relatively weak point, with the traditional 
friendship of the two ruling Communist Parties tested by 
bilateral incidents and rising distrust of China's motives 
in Asia, according to Vietnamese think tank and foreign 
policy officials.  Some members of the GVN and Communist 
Party of Vietnam (CPV) believe that China wants peace and 
stability in the short term to advance its economic 
development goals, but has not done enough to prove its good 
intentions, and others believe that Vietnam has more to gain 
from a close relationship with the United States than with 
China.  End Summary. 
 
2. (SBU) Visiting NSC Senior Director for Asian Affairs Dr. 
Michael J. Green had lunch February 4 at the Ambassador's 
residence with Mr. Bui The Giang, Director, Department of 
People to People Relations, External Relations Commission, 
Communist Party of Vietnam (CPV); Dr. Do Tien Sam, Director, 
China Studies Institute; Mr. Nguyen Vinh Quang, Director, 
China and North East Asia Department, Commission for 
External Relations, CPV; Dr. Nguyen Thiet Son, Director, 
Center for North America Studies; and, Ambassador Trinh 
Quang Thanh, General Director, Institute for International 
Relations, Ministry of Foreign Affairs (MFA).  The 
Ambassador, Poloff and A/PAO also attended.  The lunch 
covered a range of strategic issues but focused most heavily 
on China and U.S.-Vietnam relations. 
 
Communist Parties are Close; People, not so Close 
--------------------------------------------- ---- 
 
3. (SBU) The China Institute's Dr. Sam started with a 
description of Vietnam's long and tangled history with 
China, and noted that the Chinese Communist Party (CCP) has 
"long and deep" relations with the CPV.  The Vietnamese 
people have a somewhat more complicated relationship with 
China, Sam said.  "In the past, when we were in a different 
situation, China and Vietnam provided mutual assistance. 
Later, we were in a period when relations did not proceed as 
normal, and that period reached its peak with a war.  Today, 
we are again developing towards mutual cooperation." 
 
4. (SBU) The most important factor in the Vietnam-China 
relationship, Sam said, is China's astounding economic 
growth.  That growth is attractive to the Vietnamese people, 
especially to young people.  The CPV's Giang, interjecting, 
noted that there are no surveys of public opinion of China 
that disaggregate data by generation, so it is difficult to 
prove that assertion.  The CPV's Quang said he believes 
there is a range of views on China, but that attitudes are 
determined by subjective prejudice and the kind of 
information the people receive about China.  Young 
Vietnamese people and old Vietnamese people harbor 
"prejudice and negative feelings" in equal amounts, Quang 
stated.  Whatever the generational attitudes, Sam 
stipulated, the important factor is economic growth and 
development.  "China and Vietnam are carrying out a 
simultaneous economic reform and development agenda," he 
said, "and we both need a peaceful and stable environment to 
carry that out."  Since the 16th CCP Congress, China has 
been more actively engaged internationally, Sam noted. 
There has been a change in priorities in favor of what Sam 
called "neighbor countries," which do not necessarily share 
a border with China.  The main characteristics of neighbor 
countries, Sam explained, are that they are politically 
reliable, provide a market for Chinese goods and participate 
in "shared security."  The purpose of this policy is for 
China to "break through the blockade," Sam said, a desire 
that also motivated China's proposal to create a China-ASEAN 
free trade area. 
 
Key Issue: Territorial Competition 
---------------------------------- 
 
5. (SBU) Although Vietnam is definitely included in China's 
list of "neighbor countries," some bilateral issues remain, 
Sam continued.  Competition between China and Vietnam in 
certain areas is fierce.  Territorial issues are the most 
visible of these, with "considerable" problems remaining 
that are "not easy to engage on."  Many of these issues are 
also driven by China's economic growth, which has created a 
massive demand for energy resources.  "Sixty percent of 
China's energy needs are currently supplied from the Middle 
East," Sam said, "which is something the Chinese do not 
like.  They need to diversify their energy sources and they 
believe the East Sea (South China Sea) is a major potential 
source of oil and gas."  This in turn creates tensions with 
Vietnam, which considers the Spratly Islands region of the 
South China Sea to be Vietnamese territory.  Vietnam is 
conflicted about how to handle energy exploration in the 
South China Sea in the absence of an agreement on who owns 
the resources, Sam said.  China and the Philippines 
announced an "open agreement" on oil and gas exploration in 
the South China Sea and invited Vietnam to participate, an 
invitation that is "under consideration" by relevant line 
agencies in the GVN. 
 
6. (SBU) Fishing in the Tonkin Gulf and elsewhere in the 
South China Sea also creates problems, Sam continued.  The 
recent incident between Chinese Maritime Police and 
Vietnamese fishermen that resulted in nine deaths (Ref. A) 
was "regrettable" and should not be used to provoke 
hostility against China.  Sam acknowledged the difficult 
history between China and Vietnam, noting that in the 2,200- 
year history of China-Vietnam relations, 1,200 of those 
years have been spent at war.  Of 17 wars in the history of 
Vietnam, 12 were with China, "in which Vietnam was defeated 
twice."  The result of those defeats was what the Vietnamese 
still refer to as "the 1,000-year domination."  The point is 
that it is very dangerous to "provoke nationalist hostility" 
between China and Vietnam, Sam concluded. 
 
7. (SBU) Giang noted sourly that Vietnam has fishing 
disputes with four other countries (the Philippines, 
Thailand, Malaysia and Indonesia), all of which were worked 
out peacefully without the deaths of Vietnamese fishermen. 
Admittedly, three of the Vietnamese boats were "doing things 
inappropriately," but the Chinese reaction was still 
excessive.  Giang blamed the exacerbation of Vietnamese 
public hostility on overseas Vietnamese who had made a point 
of demanding publicly that the Vietnamese Government react 
to the incident and force the Chinese Government to 
compensate the families of the fishermen who died in the 
clash.  "We could be working fairly and squarely with the 
Chinese," Giang said, "but the Viet Kieu (overseas 
Vietnamese) make it very difficult."  The reality is that 
Vietnam can always increase its number of international 
partners, but it cannot increase its number of neighbors. 
Vietnam is stuck with China and had to find a way to live 
with China peacefully.  China, Giang noted, claims it is 
"rising peacefully" but has not yet "earned that privilege 
through responsible action."  The Institute for 
International Relations' Ambassador Thanh agreed, saying 
that China needs a peaceful environment in which to conduct 
its economic development and so should be willing to 
contribute to that environment. 
 
Regional Architecture 
--------------------- 
 
8. (SBU) Regional architecture systems in Asia have until 
recently been based around ASEAN, Thanh observed, but China 
wants to change things so that "ASEAN is not driving."  Dr. 
Green observed that if APEC is strong, then the East Asia 
Summit (EAS) will become a complementary process.  Giang 
said this is a possibility that drives GVN thinking, as 
well. 
 
9. (SBU) China plays an important role as the economic rival 
of Southeast Asian countries, the Ambassador observed.  To 
avoid being overwhelmed by "the world's manufacturing 
platform," the countries of ASEAN should become more nimble 
than China, increasing intellectual property rights 
protection, reducing barriers to trade and improving the 
investment environment.  In this way, ASEAN could become a 
place "where investment is easy."  Giang noted that the 
consensus-driven decisionmaking process in ASEAN means that 
cooperation is easiest "where we have commonalities."  Dr. 
Green noted that ASEAN's internal differences and consensus 
structure are weaknesses that China does not share.  Giang 
responded that other consensus organizations, such as the 
Asia-Europe Meeting (ASEM) are able to accomplish a great 
deal.  ASEM's approach to Burma's participation in the Hanoi 
summit last year (Ref. B) was the best example, he said. 
"It was a problem, but it was surmountable." 
 
China-Vietnam-United States Triangle 
------------------------------------ 
 
10. (SBU) Dr. Green observed that there is a "feeling in 
Washington" that Vietnam resists developing strategic 
relations with the United States "out of concern for China's 
reaction."  Not so, Giang replied quickly.  "Vietnam must 
conduct a balancing act," he explained.  "We are cautious 
not out of fear of destabilizing relationships, but out of 
fear of being misinterpreted."  The Ambassador noted that 
the number of U.S. Navy ship visits to Vietnam is kept 
artificially low "out of concern for China" and said that 
the United States would like to do more.  Dr. Son explained 
that bilateral relationships with China and the United 
States are very important to Vietnam, and the relationship 
between the United States and China is also of great 
interest.  "In Vietnam we have a saying," Dr. Son intoned, 
"when your friends go out together, stay back and study, and 
you will get better grades than either of them."  The North 
America Studies Center's Dr. Son said he believes that China 
is highly motivated to maintain peaceful relations with the 
United States at a time when it is trying to modernize and 
increase development.  "In our war with the French," Dr. Son 
said, "we were forced at one point in 1946 to accept an 
agreement.  We signed that to give us time to increase our 
strength and later fought back and won."  Dr. Son believes 
that China is doing the same with the United States, 
maintaining good relations no matter what during a period of 
relative weakness.  "When the United States fired rockets at 
the Chinese Embassy in Serbia," Dr. Son explained, "I told 
my friends that there would be a strong reaction from China 
but that relations would improve again quickly." 
 
Vietnam's Impression of U.S.-China Relations 
-------------------------------------------- 
 
11. (SBU) Dr. Son also believes that the United States has a 
reasonable and moderate policy towards China.  "The United 
States helps China to modernize.  You supported China's 
accession to the WTO.  You provide good support to China's 
war on terrorism and praise China's willingness to cooperate 
on terrorism.  You speak more softly to China about human 
rights and religious freedom than you do to Vietnam, and you 
do not let Taiwan interfere in U.S.-China relations," he 
observed.  Vietnam should learn lessons from this, Dr. Son 
said.  "ASEAN is a good organization, but it is not 
monolithic and even if it were, all the resources and 
strengths combined do not equal the United States or China. 
Working within APEC is slow, despite the leadership role of 
the United States."  Vietnam should try to cooperate more 
with countries who are in a position to help Vietnam to 
develop, something China cannot do.  "China does not have 
the technology or level of development to help Vietnam," Son 
said.  "Only the United States does.  Vietnam highly 
appreciates this, as well as the fact that 25 percent of 
Vietnamese trade turnover is with the United States.  If the 
United States can focus its future cooperation on economic, 
social and security issues, it would be good," he said. 
 
12. (SBU) After noting that the United States does not 
"speak more softly" to China than Vietnam about human rights 
and religious freedom, Dr. Green said that development 
changes countries and that the United States expects that 
China, too, will change.  During that change process, the 
United States is committed to maintaining positive relations 
with China and keeping Asia strong so that China will join 
with Asia and not the other way around.  (Note: The 
assembled Vietnamese guests were nodding at this point, 
though they did not interject.  End Note.)  The response to 
the tsunami disaster was revealing about China, Dr. Green 
said.  The paltry Chinese offer of assistance, a mere USD 
2.5 million, was a small fraction of what the Chinese could 
afford, but it represented the maximum amount for which the 
Chinese government could obtain internal consensus. 
"China," Green observed, "has a very large presence in Asia, 
but a limited amount of flexibility."  Agreeing vehemently, 
Giang added, "China is not just one, but many countries if 
you consider the inconsistencies in its internal 
development."  Green continued, "China has internal concerns 
about which it is very insecure, such as Tibet and Taiwan. 
The lesson of history is that the region needs China; but 
now, China truly needs the region and for that reason, 
Vietnam can and should approach China with confidence."  To 
a chorus of agreement from the Vietnamese guests, Dr. Green 
concluded: "Despite the concerns in the Central Highlands, 
Vietnam's territorial integrity is quite solid.  But I do 
not know if China can have the same confidence." 
 
13.  (SBU) Comment: Dr. Green tapped into a vein of distrust 
of China that was unusual both for its vehemence and for the 
fact that it was shared openly with Americans in front of 
other ranking Vietnamese officials.  It appears that recent 
bilateral incidents have had an effect on Vietnamese 
attitudes.  End Comment. 
 
14. (U) Dr. Green cleared this message. 
 
MARINE