Vietnam: Agreeing to disagree

China and Vietnam have climbed down from months of tense stand-off over territorial claims in the South China Sea by agreeing during a meeting in Hanoi to 'negotiations and peaceful, friendly consultations' to find a compromise. The two governments also decided to speed up talks and to sign an agreement as soon as possible.

China has long squabbled with its southern neighbours – not only Vietnam but also the Philippines, Malaysia, and others in Southeast Asia – over ownership of the Spratly and Paracel Islands in the South China Sea. It claims a large swath of the maritime territory, including areas that the other countries insist fall within internationally recognised maritime borders within 200km from their coastline.

This summer, Chinese ships raised hackles in both Hanoi and Manila by acting in ways that were viewed by the Southeast Asian governments as provocative and aggressive.

The agreement between China and Vietnam was signed on 6 September, the fifth anniversary of the establishment of a China–Vietnam Steering Committee on Cooperation. The two parties agreed that under the 'current, complex international environment' it made sense for the neighbours to attempt a reconciliation.

Earlier, in late August during a meeting in Beijing, the two governments agreed to establish a hotline linking the two defence ministries and to expand military ties using the exchange of official delegations and students. China also promised to share its experiences working with UN peacekeeping forces, something Vietnam has not done but in which it has expressed an interest.

For more news and expert analysis about Vietnam, please see Vietnam Focus.

© 2011 Menas Associates

Vietnam jails blogger for three years

A French-Vietnamese blogger, Pham Minh Hoang, has been sentenced to three years in prison for publishing articles that have reportedly "blackened the image of the country".

Speaking during his trial in Ho Chi Minh City, Hoang said he had joined an opposition group but emphasised the fact the he did not intend to overthrow the government.

There has been talk among human rights activists about the increasing numbers of imprisonments of those who dare critique the Vietnamese government. France's Foreign Ministry had earlier voiced "serious concern" about Hoang's case.

Hoang, who was said to have written over 30 articles under the pen name Phan Kien Quoc, asked for leniency, stating that he did not know he was breaking the law.

Addressing the court he said: "My writings were not aimed at overthrowing anyone…I only pointed out the negative things in society, and I think the country needs to be more democratic."

Hoang, who has dual citizenship, received a more lenient jail term of three years due to the aforementioned, and although he confessed to belonging to the banned opposition group Viet Tan, he said he was not acting as an active operative.

Sources: BBC News, AFP, Bloomberg

For more news and expert analysis about Vietnam, please see Vietnam Focus.

Vietnam and US sign military co-operation agreement

The US navy released a statement saying US and Vietnam have signed a co-operation agreement in Hanoi, paving way for a future military relationship. The statement said, the two countries will work together on health, setting the stage for exchanges and research collaboration in military medicine.

The new agreement marks the first formal military co-operation between the former foes since the neutralisation of diplomatic relations in 1995. The Navy's Surgeon General Vice Admiral Adam M. Robinson Jr said the agreement was not politically motivated but based on prospective future collaboration on health issues.

Robinson explained: “Medicine and medical research are universal languages that all countries and cultures understand. Diseases affect us all in the same way…By working together in areas such as infectious disease research, we not only help each other, we help the world meet these global health challenges."

The US is expanding military co-operation with the Southeast Asian nation despite concerns over Vietnam's human rights record. In fact, in recent months, a number of US lawmakers have urged President Barack Obama's administration to improve relations with Vietnam contingent on improvements in human rights.

Sources: AFP, The Australian

For more news and expert analysis about Vietnam, please see Vietnam Focus.

Vietnam: China's coal lessons

The question of coal imports spotlights the dif­ficulties of Vietnam's energy pricing structure and the limits it is causing in the growth of energy and the timing of liberalisations in the energy sector.

China is currently facing similar constraints in its electricity, and the Chinese case shows that the liberalisation of markets, especially miner­als and electricity, needs to be carried out in a coordinated way.

China is currently suffering an electricity crisis due to its continued control of electricity pricing in the domestic and industrial markets and its reliance on coal for electricity production.

China relies on coal for 73 per cent of its electricity production and the price of coal has been steadily rising as demand for electricity has grown in manufacturing, industry, and the consumer market.

Yet while coal prices are allowed to increase in line with domestic and import costs, electricity producers are forced to keep their prices in line with government guidelines. Electricity genera­tors are losing money as input prices rise and retail prices remain steady.

Electricity generators and utility companies, the majority of which are state owned, are growing very unhappy. Many have decided to cut pro­duction rather than continue to incur losses.

This is affecting industry across China as factories are forced to cut production due to brownouts and blackouts. And commodity mar­kets as far away as Australia are suffering from a downturn in demand for natural resources such as coal, copper, and tin used in China's manufac­turing industry.

The obvious lesson is that the Vietnamese government should be careful how it introduces competition into the electricity market and should ensure that input markets move at the same time. Input suppliers and producers can suffer losses for only so long and as demand for electricity grows so will the strength of partici­pants in the electricity sector.

For more news and expert analysis about Vietnam, please see Vietnam Focus.

© 2011 Menas Associates

Vietnam: Twelfth National Assembly fires last shot

As its tenure drew to a close with a short meeting this month before dissolution in order to prepare for the May election, the 12th National Assembly took one last pot shot at the government by rejecting the Capital Bill.

The bill had already been discussed by the National Assembly in May 2010 and was rejected at that time with the request that drafters make alterations.

The proposed law would have set Hanoi apart from other provinces by giving it its own migration controls and resident rules, its own zoning rules and guidance, and its own financial policies and priority access to government funds for infrastructure and other investment.

Some delegates thought the law was unconsti¬tutional. Others thought that many of the rules it outlined were valid but ought to cover major urban areas Ho Chi Minh City, Da Nang, and Hai Phong and not just Hanoi. Of particular concern was the residency registration requirement that would require those not registered in Hanoi to gain official employment and registration before moving there.

Delegates voted 35.9 per cent in favour and 44.83 per cent against the bill. As one delegate put it, "Basically the dishes are still being prepared by the central government. But now it's the decision of the National Assembly on whether to eat or not."

For more news and expert analysis about Vietnam, please see Vietnam Focus.

© 2011 Menas Associates

ExxonMobil to start drilling in Vietnam at the end of April

ExxonMobil will start its first exploratory drilling off the central coast of Vietnam at the end of April. The decision followed a meeting of the company's representative and leaders of the People's Committee of Da Nang City.

The two sides discussed plans to avoid environmental pollution and ensure safety. The drilling will be conducted at block 119 on the continental shell offshore from Quang Ngai Province and Da Nang City. Vice chairman of the Da Nang People's Committee, Phung Tan Viet, ordered the city's Department of Agriculture and Rural Development to inform fishermen not to use the exploration area during the 40 days of drilling.

ExxonMobil' Chief Executive Officer Rex Tillerson recently said that the company plans to spend around $100 million a day for the next half decade as it drills previously unreachable oil and natural gas deposits. He added that the company has budgeted $34 billion for capital projects this year, a 5.6 per cent increase from 2010.

Sources: Viet Nam News, Huston Chronicle, AP

For more news and expert analysis about Vietnam, please see Vietnam Focus.

Vietnam says it will still build country's first nuclear power plants

Deputy Director of Vietnam's National Centre for Hydrometeorological Forecast, Le Thanh Hai, has denied rumours that Vietnam was going to be hit by “radioactive rain” travelling from Japan. He added: “No wind can bring radioactive dusts from Japan to Vietnam. There is no wind from Japan to China and then to Vietnam. There is only wind blowing from Vietnam to Japan. The current rain is caused by monsoon, not acid rain.”

Subsequently, the Vietnamese government has said that it intends to implement the plan to built the country's first nuclear power plants, with the help of both Japan and Russia.

A spokesman for Vietnam's Foreign Ministry, Nguyen Phuong Nga, said that the country's environmental security was at the top of the government's agenda and was “particularly important in the context of climate change and natural disasters, particularly the earthquake and tsunami in Japan.” She went on to say that Vietnam would work with Japan and other international partners to develop nuclear energy while “ensuring nuclear safety and environmental protection.”

Former director of Vietnam's institute for nuclear science and technology, Tran Thanh Minh, said the government was right to stay on course despite the ongoing nuclear crisis in Japan. He said: “I'm concerned about what's happening in Japan but...Vietnam will be using the latest nuclear technology and will have to put a bigger focus on safety and engineering when it comes to our nuclear reactors.”

Sources: FT, MSN Philippines News, Vietnam Net

For more news and expert analysis about Vietnam, please see Vietnam Focus.