US, Vietnam trade deals are 'historic': Analyst

President Biden's recent visit to Vietnam marked a historic moment in the evolving relationship between the two nations. Amid various trade deals announced, one standout agreement was Vietnam Airlines' commitment to acquire 50 Boeing (BA) jets. Eurasia Group Global Macro-Geopolitics Senior Analyst Ali Wyne explains why the Biden administration has placed an emphasis on the Indo-Pacific, with a focus on strengthening relations with countries like Australia, India, and Japan. Wyne says the U.S. doesn't want other countries in the region to feel left out, however, saying the administration "doesn't want smaller countries in the region to feel that they're being left out."

Video Transcript

AKIKO FUJITA: Well, the President announced a number of trade deals during his visit, including Vietnam Airlines buying 50 Boeing Jets and Microsoft announcing AI plans tailored for Vietnam's emerging market. Here to discuss more is Ali Wyne, macro-geopolitics senior analyst at the Eurasia Group. Ali, it's good to talk to you today.

Put this in context for us first. This elevated status the US now has with Vietnam, the announcement of these deals-- how significant is it when you consider the historical relationship between the US and Vietnam and where China is today?

ALI WYNE: Well, thanks very much for having me on. It's historic for the reasons that you mentioned, given the state of relations between the United States and Vietnam just a few decades ago. It is historic, and I think, as you said, it's important to look at these deals that are being signed in a broader context. The United States has prioritized the Indo-Pacific. It believes that the Indo-Pacific is the most significant theater of strategic competition, and it's trying to bolster its influence in the region.

Now, the principal way that the Biden administration has been doing so up until now has been a strength in US relations with its allies in the quad-- this is Australia, India, and Japan. But the administration wants to ensure that it's committed to the entirety of the region, and it doesn't want smaller countries in the region to feel that they're being left out. So the administration, in parallel with its efforts to boost the quad, it's also deepening its engagements with a number of member countries of ASEAN, including Indonesia, including the Philippines, and, of course, Vietnam. So what we see is two parallel lines of effort to bolster America's presence in the Indo-Pacific.

AKIKO FUJITA: Ali, what kind of response do you think we'll see here from China given the fact that this really just shows us how Biden is looking at the geopolitical relationships here going forward and how he's calculated being able to get to those regions, secure products that the US needs-- that US companies need-- without relying obviously as much on China?

ALI WYNE: Well, China is going to be vigilant. China is going to be concerned because, keep in mind, China is not only facing growth headwinds at home, and those growth headwinds, of course, are a critical source of China's influence in the Indo-Pacific and beyond, but China also recognizes that there's a growing coalescence of opposition to China in the region-- in the Indo-Pacific that is-- but beyond. And we just-- to give one example, we saw a few days ago that China published a new map, its so-called 10-dash map, and that elicited a lot of concern from many neighbors with which China has maritime disputes and other territorial disputes.

So China is going to be vigilant. I think China also recognizes, though, that many countries in the region, including Vietnam, they're wary of openly aligning too strongly with either the United States or with China. They want to balance security ties with the United States but economic ties with China, and so Vietnam is undertaking a very difficult balancing act.

AKIKO FUJITA: What does that tell you about the increasing importance of the region, then, if you've got a country like Vietnam but really ASEAN nations broadly being able to say, look, we are able to play both sides? It seems to point to the significant or growing significance of that region.

ALI WYNE: No matter what metric you consider-- whether you look at share of the global economy, whether you look at the share of global defense spending, the share of the global population. No matter what metric you consider, the Indo-Pacific today is the center of geopolitical and geoeconomic gravity, and it will continue to be so. And to your-- to your question, I think what's interesting is one of the narratives that we often hear is that countries in the region will have to make a choice-- a so-called strategic choice-- in which they pick only the United States or only pick China. It's a very common narrative.

And I think that what a growing number of countries in the Indo-Pacific are demonstrating is they're flipping the script and they're saying, one, we don't accept that choice, and two, we can actually leverage intensifying US-China competition to our advantage. So if the United States is courting me, if China is courting me, it enhances my freedom of foreign policy maneuver, it gives me more trading and investment opportunities. So Vietnam is demonstrating how we can flip the script in the region and how smaller countries in particular can capitalize on intensifying competition between Washington and Beijing.