Vietnam

In 1986, Vietnam was one of the poorest countries on Earth—a war-devastated communist state with a per capita GDP of approximately $100, wracked by famine and international isolation. Four decades later, GDP per capita exceeds $4,300, poverty has fallen from over 50% to under 5%, and Vietnam has become the world’s third-largest exporter of smartphones (behind China and South Korea), a major garment and electronics manufacturer, and one of the fastest-growing economies in Asia. The transformation—driven by the Doi Moi (“renovation”) reforms that opened the economy to market forces while preserving one-party Communist rule—ranks alongside China’s economic miracle as one of the most successful development stories of the late 20th century.

But Vietnam’s significance for geopolitics extends far beyond economics. Positioned along 3,260 kilometers of coastline on the South China Sea—the most contested waterway in the world—with a 1,300-kilometer border with China, Vietnam finds itself at the geographic center of the Indo-Pacific’s defining strategic competition. Its response has been what Vietnamese diplomats call “bamboo diplomacy”: bending with prevailing winds without breaking, maintaining relationships with both Washington and Beijing, joining neither camp while extracting benefits from both. For a country that spent the better part of the 20th century fighting the French, the Japanese, the Americans, the Chinese, and the Cambodians, this diplomatic agility is not new—it is survival refined into statecraft.

Geographic Foundations¶

Vietnam’s geography is both asset and vulnerability. The country is shaped like an elongated “S”—approximately 1,650 kilometers from north to south but only 50 kilometers wide at its narrowest point. This extreme elongation means that Vietnam can be cut in half at its waist, a vulnerability that has shaped military planning for centuries.

The Red River Delta in the north, centered on Hanoi, is the historical heartland of Vietnamese civilization—a densely populated agricultural region that has supported intensive rice cultivation for millennia. The Mekong Delta in the south, centered on Ho Chi Minh City (formerly Saigon), is one of the world’s most productive agricultural regions, producing rice, seafood, and fruit that feed both Vietnam and export markets.

The Central Highlands, bordering Laos and Cambodia, provide strategic depth but also vulnerability—the Ho Chi Minh Trail, which supplied communist forces during the Vietnam War, ran through this mountainous terrain. Today, the highlands produce coffee (Vietnam is the world’s second-largest coffee exporter) and host ethnic minorities whose relationship with the Vietnamese state remains complicated.

Vietnam’s coastline on the South China Sea is its most strategically significant geographic feature. The coast provides access to some of the world’s busiest shipping lanes—approximately $3.4 trillion in annual trade transits the South China Sea—and to fishing grounds that support millions of Vietnamese. Vietnam claims Sovereignty over the Paracel Islands (occupied by China since 1974) and much of the Spratly Islands, where both Vietnam and China maintain military garrisons on overlapping features.

Historical Context¶

A Thousand Years of Chinese Rule¶

Vietnam’s relationship with China is defined by proximity and resistance. For over a thousand years (111 BCE to 938 CE), Vietnam was a province of the Chinese empire. The Vietnamese absorbed Chinese culture, institutions, and writing systems while simultaneously developing a fierce national identity defined by opposition to Chinese domination. The Trung Sisters’ rebellion (40 CE), the Ly dynasty’s victory at the Battle of Bach Dang River (938 CE), and Le Loi’s expulsion of the Ming (1427) are foundational national myths—each a story of resistance against the northern giant.

This history shapes contemporary Vietnamese strategic thinking. Vietnam cooperates with China when interests align but never trusts Chinese intentions. The brief but brutal Sino-Vietnamese War of 1979—when China invaded Vietnam’s northern provinces in retaliation for Vietnam’s invasion of Cambodia—reinforced the lesson that China will use force against Vietnam when it calculates the cost is acceptable. The war lasted only a month and cost perhaps 50,000 casualties on both sides, but it reminded Vietnamese leaders that the threat from the north is permanent.

The Vietnam War and Its Aftermath¶

The wars against France (1946-1954) and the United States (1955-1975) defined Vietnam in the Western imagination but represent only one chapter in a much longer strategic history. Vietnam’s victory over the United States—the world’s most powerful military—in 1975 was achieved through the patient application of guerrilla warfare, political mobilization, and strategic endurance against a technologically superior adversary. The cost was enormous: an estimated 2-3 million Vietnamese dead, massive infrastructure destruction, and a generation traumatized by conflict.

The postwar period brought further hardship. The communist government’s attempt to impose central planning on the south’s market economy produced economic collapse. The invasion of Cambodia (1978) to remove the Khmer Rouge brought international isolation and a punitive Chinese invasion. By the mid-1980s, Vietnam was impoverished and friendless.

Doi Moi and Economic Transformation¶

The Doi Moi reforms of 1986 represented a pragmatic course correction—maintaining communist political control while opening the economy to market forces, foreign investment, and international trade. The parallels with China’s reforms under Deng Xiaoping are deliberate; the Vietnamese leadership studied the Chinese model carefully and adapted it to Vietnamese conditions.

The results have been remarkable. GDP growth has averaged approximately 6-7% annually for three decades. Foreign direct investment has flooded in, attracted by low labor costs, a young and educated workforce, political stability, and Vietnam’s strategic position in global supply chains. Samsung alone employs over 100,000 workers in Vietnam and accounts for roughly 20% of the country’s exports. Apple, Intel, and dozens of other multinational corporations have established manufacturing operations.

The shift of manufacturing from China to Vietnam—accelerated by the US-China trade war’s tariffs and companies’ desire to diversify supply chains—has positioned Vietnam as a primary beneficiary of the global “China Plus One” strategy.

Bamboo Diplomacy¶

Vietnam’s foreign policy is a masterclass in strategic balancing. The country maintains deep relationships with both the United States and China while committing to neither:

With China: Vietnam shares a land border, a communist political system, extensive trade (bilateral trade exceeds $170 billion annually), and deep cultural ties. China is Vietnam’s largest trading partner and an important investor. The two countries’ communist parties maintain party-to-party relations alongside state-to-state diplomacy. But Vietnamese public opinion toward China is among the most negative in Asia, driven by the South China Sea disputes and historical memory.

With the United States: The former adversaries have undergone a remarkable rapprochement. The US-Vietnam relationship was upgraded to a “Comprehensive Strategic Partnership” in 2023—Vietnam’s highest diplomatic tier. American companies are significant investors; American consumers are the largest market for Vietnamese exports. Defense cooperation has expanded to include port visits by US Navy vessels, intelligence sharing, and coast guard capacity building. The United States has an interest in strengthening Vietnam as a counterweight to Chinese influence in Southeast Asia.

With Russia: Vietnam maintains its Soviet-era relationship with Russia, which remains its largest arms supplier (Su-30 fighters, Kilo-class submarines, S-300 air defense systems). Russia’s invasion of Ukraine complicated this relationship—Vietnam abstained on UN votes condemning the invasion—but Hanoi is reluctant to alienate a security partner that provides leverage against both China and dependence on the United States.

Within ASEAN: Vietnam uses the Association of Southeast Asian Nations as a multilateral platform to manage the South China Sea disputes, preferring collective negotiation to bilateral confrontation with China where Vietnam’s size disadvantage is overwhelming.

The South China Sea¶

Vietnam’s most dangerous strategic challenge is the South China Sea, where Chinese claims overlap with Vietnamese claims across the Paracel and Spratly Islands:

China seized the Paracel Islands from South Vietnam in 1974 (during the final stages of the Vietnam War, when Saigon could expect no American support) and has administered them since. In 1988, Chinese forces killed 64 Vietnamese sailors during a skirmish over Johnson South Reef in the Spratlys. China’s construction of artificial islands and military installations in the Spratlys since 2013 has dramatically shifted the military balance.

Vietnam’s response has been to strengthen its own positions (it occupies approximately 49 features in the Spratlys, the most of any claimant), invest in asymmetric military capabilities (Kilo-class submarines, shore-based anti-ship missiles), and pursue diplomatic and legal avenues. Vietnam has tacitly benefited from the 2016 arbitral tribunal ruling (brought by the Philippines) that rejected China’s nine-dash line claims, though it has not brought its own case.

Conclusion¶

Vietnam’s trajectory—from war-ravaged communist state to dynamic emerging economy and strategic balancer—represents one of the most impressive national transformations of the late 20th century. Its geographic position, diplomatic agility, and economic dynamism make it an increasingly important player in the Indo-Pacific order that Great Power Competition between the United States and China is reshaping.

The bamboo bends but does not break. For a nation that has survived a thousand years of Chinese rule, a century of French colonialism, and decades of devastating war, the current strategic environment—challenging as it is—is neither unfamiliar nor unmanageable. Vietnam’s history suggests that it will find a way to navigate great power competition without surrendering its independence. Whether that independence can endure if the competition escalates to confrontation remains the open question.

Sources & Further Reading¶

• Vietnam: A New History by Christopher Goscha — The most comprehensive English-language history of Vietnam from ancient times to the present, placing the American war within a much longer arc of Vietnamese state-building and resistance.

• The Vietnam War: An Intimate History by Geoffrey C. Ward and Ken Burns — A deeply human account of the American war, drawing on Vietnamese as well as American perspectives to illuminate the conflict’s complexity.

• Fire on the Water: China, America, and the Future of the Pacific by Robert Haddick — Analysis of South China Sea competition and its implications for regional security, with attention to Vietnam’s strategic position and military capabilities.

• Vietnam’s Foreign Policy under Doi Moi by Le Hong Hiep — Scholarly analysis of how Vietnam has navigated great power competition since economic reforms, explaining the logic behind bamboo diplomacy.