Vietnam-US Strategic Partnership

U.S. President Joe Biden finalized agreements with Vietnam regarding semiconductors and minerals, while elevating the diplomatic status of Vietnam to the highest level. The U.S. has been actively pursuing this upgrade for several months, recognizing Vietnam as a crucial player in its strategy to secure global supply chains.

This visit by Biden coincides with the growth of bilateral trade and investment ties between the two nations. Additionally, Vietnam Airlines is signing an agreement valued at USD 10 billion to purchase 50 Boeing 737 Max jets.

Highlighting Vietnam's increasing significance as a preferred destination for U.S. technology companies, executives from Google, Intel, Amkor, Marvell, GlobalFoundries, and Boeing are met with Vietnamese tech leaders and Secretary of State Antony Blinken in Hanoi.

Semiconductors are a key focus of the action plan established during Biden's visit, with U.S. officials emphasizing their importance. The U.S. government has allocated USD 100 million per year for five years under the CHIPS Act to support semiconductor supply chains globally, with a significant portion potentially benefiting Vietnam. Enhancing the training of skilled workers is also part of the agreement, as Vietnam grapples with a shortage of engineers in the semiconductor sector.

Another aspect of the partnership is strengthening the supply chains for critical minerals, especially rare earths, where Vietnam possesses the world's second-largest deposits after China, according to U.S. estimates.

Here below a selection of paragraphs from the two countries joint statement on the Strategic Partnership, trade and economic cooperation.

On September 10, 2023, General Secretary of the Communist Party of Vietnam Central Committee Nguyen Phu Trong and President of the United States Joseph R. Biden Jr. (the “Leaders”) met and held talks in Hanoi, Vietnam. The two Leaders hailed a historic new phase of bilateral cooperation and friendship by elevating their nations’ relationship to a Comprehensive Strategic Partnership for the purposes of peace, cooperation, and sustainable development. The United States supports a strong, independent, prosperous, and resilient Vietnam.

In the ten years since President Truong Tan Sang and President Barack Obama formed the Vietnam–U.S. Comprehensive Partnership, the two countries have made remarkable strides in increasing mutual understanding, building mutual trust, and strengthening cooperation across all areas of the Comprehensive Partnership. Under this new framework, the Leaders underscored the fundamental principles guiding Vietnam–U.S. relations, including respect for the United Nations Charter, international law, and respect for each other’s political system, independence, sovereignty, and territorial integrity. Vietnam and the United States will continue to deepen cooperation in the following areas to ensure the interests of the people of both countries and contribute to peace, stability, cooperation, and prosperity in the region and in the world.

The two Leaders reaffirmed the importance of economic, trade, and investment cooperation and innovation-driven inclusive economic growth as the core foundations and sources of momentum in the bilateral relationship. Both sides pledged to create favorable conditions and facilitate the further opening of markets for each other’s goods and services, support trade and economic policy, and regulatory measures to achieve this aim; and to address issues such as market access barriers via the Trade and Investment Framework Agreement. The United States applauds Vietnam’s progress in significant market-based economic reforms, and affirms its enthusiasm and commitment for a broad, strengthened, supportive, and constructive engagement with Vietnam in its transition to a market economy, and subsequently to market economy country status, under U.S. law. The United States noted Vietnam officially requested the review of its market economy status on September 8, 2023. The United States will review Vietnam’s request as expeditiously as possible, in accordance with U.S. law. The United States appreciates Vietnam’s ongoing efforts to further modernize and enhance the transparency of its monetary policy and exchange rate management framework, to promote macroeconomic stability, and to ensure the safety and soundness of the banking system.

The Leaders will continue strengthening a non-discriminatory, open, fair, inclusive, equitable, transparent and rules-based multilateral trading system with the World Trade Organization at its core. Both sides applauded the progress thus far and look forward to additional substantial progress in the near future under the Indo-Pacific Economic Framework for Prosperity (IPEF), which will deliver concrete benefits to the economies, workers, families, and businesses of the two countries and the region.

The Leaders acknowledged the importance of respect for internationally recognized labor rights based on the ILO Declaration on Fundamental Principles and Rights at Work. Furthermore, the Leaders intend to accelerate cooperation on strengthening intellectual property rights and aviation, including through negotiations to amend the U.S.-Vietnam Air Transport Agreement under Open Skies principles.

The United States pledged further support for Vietnam in manufacturing, high quality digital and physical infrastructure development, just energy transition, sustainable and smart agriculture, and broader and sustained participation in regional and global supply chains, with a particular emphasis on Vietnam’s Mekong Delta region. To that end, the U.S. International Development Financial Corporation (DFC) intends to continue to finance private sector projects in Vietnam’s infrastructure, climate and energy efficiency, healthcare, and small business sectors, including climate-focused and women-owned enterprises.