EXCLUSIVE: Biden aides in talks with Vietnam over arms deal to anger China

U.S. President Joe Biden speaks during a luncheon with Vietnamese President Vo Van Tuong on September 11, 2023 in Hanoi, Vietnam. REUTERS/Evelyn Hockstein/File Photo Get license rights

WASHINGTON, Sept 23 (Reuters) – The Biden administration is negotiating with Vietnam the largest arms transfer deal in history between the former Cold War foes, according to two people familiar with the deal, which could irritate China and sideline Russia.

A package that could come together by next year would complement the newly-improved partnership between Washington and Hanoi with the sale of a fleet of US F-16 fighter jets, as the Southeast Asian nation faces tensions with Beijing in the disputed South China Sea. , one of the people said.

The deal is still in its early stages, exact terms have yet to be worked out, and may not come together. But it was the main topic of Vietnam-US official talks in Hanoi, New York and Washington last month.

Washington is considering structuring special financing terms for expensive equipment that could help cash-strapped Hanoi move away from its traditional reliance on low-cost, Russian-made weapons, according to other sources, who declined to be named.

Spokesmen for the White House and Vietnam’s foreign ministry did not respond to requests for comment.

“We have a very productive and trusting security relationship with the Vietnamese, and we see interesting moves from them in some US systems, especially in their maritime domain, perhaps to better monitor transport aircraft and some other sites,” he said. American official.

“As the U.S. government gets creative, part of what we’re working on domestically is how to give them better financing options to get things that are really useful to Vietnam.”

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A major U.S.-Vietnam arms deal could aggravate China, Vietnam’s larger neighbor, which is wary of Western efforts to box in Beijing. A long-standing territorial dispute between Vietnam and China has heated up in the South China Sea and explains why Vietnam wants to build up its maritime defenses.

“They are developing asymmetric defense capabilities but (wanting) not to provoke a response from China,” said Geoffrey Artaniel, associate professor of international security studies at Tokyo International University and director of maritime security at Pacific Forum International. . “It’s a delicate balancing act.”

Ordaniel said Washington should shift funds earmarked to finance militaries in the Middle East to the Indo-Pacific region “so partners like Vietnam, the Philippines and Taiwan can buy the weapons they need to counter Beijing.”

The Biden administration has said it will try to balance geopolitical competition with China, including in the Pacific, and responsibly manage the relationship between the two superpowers.

Earlier this month, Vietnam upgraded Washington to Hanoi’s highest diplomatic status, along with China and Russia, when US President Joe Biden visited the country.

Nearly half a century after the end of the Vietnam War, the diplomatic turnaround marks a sharper focus.

Since the arms embargo was lifted in 2016, US defense exports to Vietnam have been limited to coast guard ships and training aircraft, while Russia has provided 80% of the country’s arsenal.

Vietnam spends $2 billion annually on arms imports, and Washington hopes to divert a share of that budget to weapons from the United States or its allies and partners, particularly South Korea and India.

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The cost of US weapons is a major obstacle, as is training in equipment, which is one of the reasons the country has bought less than US$400 million worth of US weapons over the past decade.

“Vietnamese officials are well aware of the need to spread the wealth,” the US official said. “We have to take responsibility in helping Vietnam get what it needs.”

Meanwhile, the war in Ukraine has strained Hanoi’s long-standing relationship with Moscow, making it difficult to buy supplies and spare parts for Russian-made weapons. Nevertheless, Reuters reports that Vietnam is actively negotiating with Moscow over a new arms supply deal that could trigger US sanctions.

Reporting by Trevor Hunnicutt and Nandita Bose; Additional reporting by Francesco Curacio in Hanoi and Mike Stone in Washington; Editing by Rosalba O’Brien

Our Standards: Thomson Reuters Trust Principles.

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