U.S. President Joe Biden secured deals with Vietnam on semiconductors and minerals during his visit to Hanoi. These agreements come as Vietnam was elevated to the highest diplomatic status alongside China and Russia.
The partnership with Vietnam is part of the Biden administration’s strategy to secure global supply chains and reduce risks associated with China-related disruptions.
Vietnam is navigating relations between Washington and Beijing, aiming to maintain good relations with both superpowers. China’s top officials, including President Xi Jinping, are expected to visit Vietnam in the coming days or weeks.
During Biden’s visit, there were discussions with Vietnamese officials regarding an $8 billion credit facility from Russia to buy heavy weaponry. This deal could help Vietnam diversify its military supplies away from Russia, reducing its reliance on Moscow.
The U.S.-Vietnam upgrade includes a security dimension, with a focus on reducing military reliance on Russia. Bilateral trade and investment ties are growing, with Vietnam Airlines expected to sign an agreement to purchase about 50 Boeing 737 Max jets, valued at $10 billion.
Semiconductors are a central part of the action plan adopted during Biden’s visit, with plans for U.S. corporations to invest in Vietnam’s semiconductor sector. Additionally, there is an emphasis on strengthening supply chains for critical minerals, particularly rare earths, of which Vietnam has substantial deposits.
While economic and strategic agreements were reached, human rights issues, including the jailing of activists and limitations on freedom of expression in Vietnam, remain a point of controversy in U.S.-Vietnam relations. Diplomats have suggested that there may be goodwill gestures, such as the release of activists, to address these concerns.
Biden’s visit underscores the growing importance of Vietnam as a partner in regional and global affairs, as well as a key player in the evolving landscape of supply chain diversification.
