Cablegate: Vietnam Seeks Stronger U.S. Support Against Chinese

VZCZCXRO4869
RR RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHHI #0864 2060933
ZNR UUUUU ZZH
R 240933Z JUL 08
FM AMEMBASSY HANOI
TO RUEHC/SECSTATE WASHDC 8187
INFO RUEHHM/AMCONSUL HO CHI MINH 4946
RUEHBJ/AMEMBASSY BEIJING 7135
RUCNASE/ASEAN MEMBER COLLECTIVE

UNCLAS HANOI 000864

SENSITIVE
SIPDIS

STATE FOR EAP/MLS, EAP/CM

E.O. 12958: N/A
TAGS: PGOV PREL ECON CM VM

SUBJECT: VIETNAM SEEKS STRONGER U.S. SUPPORT AGAINST CHINESE
PRESSURE ON EXXONMOBIL

1. (SBU) Summary: Citing recent press reports making public China's
warning to ExxonMobil to pull out of an offshore oil exploration
deal with Vietnam, an MFA official told Pol Counselor in a July 24
meeting that Vietnam will protect the interests of ExxonMobil. He
also requested a strong expression of USG support for the company.
End summary.

2. (SBU) During a July 24 meeting between the Pol Counselor and MFA
Deputy Director General for the Americas Ha Kim Ngoc, Ngoc reported
that Petrovietnam and ExxonMobil had signed an MOU to explore blocs
155-159 off southern Vietnam and were negotiating to explore Blocs
117, 118 and 119 further north. Both these sets of blocs are
clearly within Vietnamese territorial waters, Ngoc asserted.

3. (SBU) Ngoc said China's approach to ASEAN countries has changed
over the past five years and is now seen as "stubborn and
assertive." In the case of ExxonMobil China is using new tactics;
before it would only pressure the GVN with protests and warning; now
it is also pressuring the U.S. companies doing business with
Vietnam. "This is unacceptable to us," Ngoc said, adding that the
situation of ExxonMobil is a test case; if ExxonMobil, Chevron, or
ConocoPhillips were to pull out of Vietnam this could influence
other companies, he predicted. "We want these companies to stay in
Vietnam and we will protect their interests," Ngoc stated.

4. (SBU) The GVN appreciates the positive role and influence of the
United States in the region, Ngoc said. Vietnam recognizes that the
United States has expressed support for U.S. companies, Ngoc said,
but would like to see stronger expressions of U.S. support in the
ExxonMobil case.

5. (SBU) Comment: The July 20 South China Morning Post article
concerning Beijing's threats to blacklist a major U.S. company from
doing business in China if it continues to cooperate with Vietnam
was probably an unwelcome surprise to Hanoi. Vietnamese leaders are
reluctant to see the dispute become a domestic political issue,
understanding that it could easily spark a strong nationalistic
reaction among the Vietnamese people. This could create a situation
in which critics point fingers at both Beijing as bully, and at the
Vietnamese Government as weak in the face of pressure. This said,
behind closed doors the GVN remains deeply concerned by China's
tactics, knowing it will not win any arm wrestling contests with its
northern neighbor and doubtful that others, including the United
States, will strongly take its side in the dispute.

MICHALAK

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