Recently, ** is on a state visit to Vietnam, and the two sides announced the deepening of the China-Vietnam comprehensive strategic cooperative partnership and jointly building a strategically significant China-Vietnam community with a shared future. This new positioning of the bilateral relationship has attracted widespread attention, but what are the changes and trends hidden behind it?
The delicate game of China and the United States to "woo" Vietnam
Vietnam is in a delicate geopolitical position between the two powers, China and the United States, and has become the focus of their contention. Three months ago, Biden visited Vietnam, and China and the United States signed an agreement to elevate U.S.-Vietnam relations to a comprehensive strategic partnership. This is interpreted as a sign that the United States is on the same level as China in Vietnam's diplomatic relations.
Chinese investment has grown sharply, and the United States faces challenges
At the same time, Chinese investment in Vietnam has grown significantly this year, making it the largest investor in Vietnam. In the first 11 months of this year, total registered investment in Chinese mainland and Hong Kong increased to US$8.2 billion, double the same period last year, the data showed. Conversely, the U.S. ranked 10th in terms of registered investment, down from $700 million in 2022 to $500 million this year.
Vietnam's role in the global ** chain is becoming more and more critical
As an emerging manufacturing center, Vietnam is increasingly consolidating its role as an "intermediate" in the global ** chain. In the development of the global economy and industry, Vietnam's assembly and production links are becoming more and more critical. Although the failure of the United States and Vietnam to agree on tariff reductions led to a bilateral decline, Vietnam's exports to China have grown and its dependence on the U.S. market has become increasingly prominent.
Tensions between China and the United States have stimulated Chinese investment in Vietnam
Some experts believe that the increase in Chinese investment in Vietnam is partly the result of the US policy. Tensions between China and the United States and a number of U.S. sanctions against China have "stimulated" Chinese investment in Vietnam. In the first 11 months of this year, China's registered investment in Vietnam totaled US$8.2 billion, while U.S. investment fell to US$500 million, ranking tenth.
U.S. businesses face challenges in Vietnam
Despite the escalation of U.S.-Vietnam relations promoted during Biden's visit, experts noted that U.S. companies face significant challenges in investing in Vietnam. Investor interest is increasing, but decision-making still takes time. Chinese investment in Vietnam doubled to US$3.9 billion during pandemic restrictions.
China's economic slowdown is affecting investment decisions
The slowdown in China's economy is also one of the factors influencing investment decisions. As China faces short- to medium-term macroeconomic challenges, Chinese companies are increasingly motivated to seek overseas investment opportunities and avoid risks.
In this delicate game between China and the United States, Vietnam has become the focus of investment and strategic cooperation, and the upgrading of Sino-Vietnamese relations will play an important role in the future geopolitical landscape.