Chinese President Xi Jinping has embarked on a two-day visit to Vietnam, seeking to bolster economic relations between the two nations. This visit follows U.S. President Joe Biden's recent trip to Hanoi, highlighting the competition for influence in Southeast Asia between the world's two major powers.
Xi's visit, his first in six years, has been meticulously planned and was briefly considered to take place just days before Biden's visit, according to officials. The primary objective of this visit is to enhance relations between the two Communist-ruled countries, which share close economic ties but have historical disagreements, particularly concerning the South China Sea.
The delay in Xi's visit was due in part to protracted discussions over the wording of an agreement to strengthen bilateral relations. Beijing has pushed for the phrase "common destiny" to frame this enhanced relationship, a term that Hanoi initially resisted but is now expected to accept.
Beyond the symbolic significance of elevating their ties, China and Vietnam are set to sign "dozens of cooperation documents," according to China's ambassador to Vietnam, Xiong Bo. These agreements are expected to include Chinese investments in upgrading rail links between the two countries, which could involve grants, though the exact amount of aid and terms of potential loans remain uncertain.
Both nations are keen on improving transport connections. Vietnam seeks to export more goods, especially agricultural products, to China, while Beijing aims to integrate northern Vietnam into its southern supply chain networks. Chinese companies have accelerated their relocation to Vietnam this year to be closer to Western clients, mitigate risks from U.S.-China trade tensions, and reduce exposure to China's economic challenges.
The strengthened rail connections would facilitate the import of Chinese components for assembly in Vietnam, effectively expanding China's Belt and Road Initiative (BRI). Furthermore, China has proposed including Vietnam in its Digital Silk Road, which may involve investments in undersea optical fiber cables, the 5G network, and other telecommunications infrastructure.
Notably, the Hanoi metro is the only project in Vietnam that has received BRI loans, although Vietnam prefers not to openly label it as such, underscoring the sensitivity surrounding close ties with Beijing.
Other potential agreements during Xi's visit include measures to facilitate trade and cooperation in renewable energy, rare earths, and tourism. This visit underscores the significance of economic ties between China and Vietnam, despite their historical differences and regional competition.