Good morning! Hello to all new readers, and welcome to the latest edition of the Vietnam Weekly, written by Ho Chi Minh City-based reporter Mike Tatarski. The Friday newsletter is always free to read.
This week’s article for paying subscribers analyzed Vietnam’s exposure to potential U.S. tariffs given its growing prominence as a destination for Chinese manufacturing investment. If you haven’t already, you can upgrade to a paid subscription to access that and all exclusive weekly features.
If you want to support the newsletter without committing to a recurring subscription, you can also Buy Me a Coffee.
Quickly following up on a topic covered here last month: Cambodia withdrew from the Cambodia-Laos-Vietnam Development Triangle Area (CLV-DTA) on Friday, with Hun Sen writing on Facebook that the move was meant to “withdraw [a] weapon out of the hands of extremists to prevent them from using CLV-DTA to further cheat people.” I haven’t seen an official reaction from Vietnam (or Laos) yet, but some analysts believe it’s a bad sign for regional cooperation.
A new episode of The Vietnam Weekly Podcast drops Monday morning on all podcast platforms - this one features Greg Poling, Director of the Asia Maritime Transparency Initiative at the Center for Strategic & International Studies. I’m always looking for future guests, so please offer suggestions if you have any!
On to the news.
Lâm’s NYC Visit
General Secretary and President Tô Lâm is now in Cuba for a state visit after an exceptionally busy ‘working trip’ (the official designation) to New York City.
Lâm addressed the United Nations Summit of the Future on Sunday and urged global powers to share their advances: “Major powers must act responsibly and share the common sci-tech achievements to advance together. The UN and regional organizations, including…ASEAN, should take the lead in promoting cooperation and coordinating actions to respond to global challenges and harness opportunities from scientific and technological advances.”
He also spoke during the UN General Assembly and outlined a five-point vision for a better world.
While there Lâm met, among others, President of the European Commission Ursula von der Leyen, Ukrainian President Volodymyr Zelenskyy, World Bank President Ajay Banga, and U.S. President Joe Biden.
Reuters reported that Lâm told Biden that "Vietnam will continue to firmly implement its foreign policy of independence, self-reliance, multilateralism and diversification." Both leaders committed to further deepening ties between the two countries.
Vietnam and the U.S. recently marked the first anniversary of their Comprehensive Strategic Partnership.
Biden, for his part, highlighted the relationship with Vietnam during his UN speech on Tuesday: "Last year, in Hanoi, I met with the Vietnamese leadership, and we elevated our partnership to the highest level. It’s a testament to the resilience of the human spirit and the capacity for reconciliation that today the United States and Vietnam are partners and friends, and it’s proof that even from the horrors of war there is a way forward. Things can get better."
Finally, Lâm attended a seminar on boosting cooperation between Vietnam and the U.S. in semiconductors and AI, in addition to meeting representatives from major corporations and investors including Boeing, Apple, Google, Meta, SpaceX, Supermicro, Blackstone, and Warburg Pincus.
As Nguyen Khac Giang noted in his latest analysis of Lâm’s leadership thus far, this is the kind of fast-paced diplomacy and private sector engagement that the late Nguyễn Phú Trọng couldn’t pursue for the last several years due to his declining health.
Vạn Thịnh Phát (VTP) Round Two
The first week of the second trial for death row inmate Trương Mỹ Lan, former chairwoman of property developer VTP, is in the books, and it got strange in a hurry. Set to last a month, the trial involves Lan and 33 other defendants on charges of money laundering and fraudulent appropriation of property.
On Tuesday, according to Lao Động, the defense lawyer for the former general director of An Đông Company (one of VTP’s many, many subsidiaries) announced that a friend of Lan’s currently living in the U.S. had offered to lend the tycoon US$380 million “to repay debts and compensate the victims.”
Curiously, I haven’t seen the mention of this mysterious friend reported in English-language media.
The sum appears to be related to Capital Place Hanoi, an office building at 29 Liễu Giai Street in the capital. However, Lan believes the building is worth US$1 billion, while an unnamed buyer (separate from the mystery friend) has offered US$330 million for it.
Just to give a sense of how astronomical that valuation is: Aon Plc, the South Korean reinsurance firm that owns Landmark 72, Vietnam’s second-tallest building (also in Hanoi), recently said it wants to sell the skyscraper for US$753 million.
Confusingly, some of the Vietnamese-language reporting also discusses a 26-hectare plot of land in HCMC’s Bình Chánh District within this context.
Elsewhere in the trial Trương Huệ Vân, Lan’s niece and former deputy CEO of An Đông/CEO of Windsor Group, reportedly said: “In my heart I did not want to defraud or take anyone’s money. I never gained anything from the scheme apart from my VND80 million (US$3,251) monthly salary."
Vân was sentenced to 17 years in prison during the first VTP trial centered on embezzling billions of dollars from Saigon Commercial Bank (SCB). The bank is still struggling to survive while closing numerous branches - one near my house closed a few months ago.
Two SCB executives took the stand and said they were unaware of the illegal nature of Lan’s bond scheme while accepting responsibility for their role in it, with one adding that his wife and many relatives even bought some of these bonds.
Lan has offered about 300 real estate assets as compensation for victims of the bond fraud, which resulted in about US$1.2 billion in losses - but the reality is that these are little more than distressed assets that would be hard to rescue even with a fire sale.
Take, for example, the unfinished concrete monolith across from Bến Thành Market. Once owned by (yet more) VTP subsidiaries, it fell into the hands of Bitexco Group, which made no progress. This week, the structure was transferred to Hanoi Phương Đông Real Estate, a company I’ve never heard of that was established in 2019.
Unwinding the sprawling mess left behind by VTP is going to take years.
Data Corner:
US$5.5 billion: The value of 18 projects that received investment approval from Bắc Ninh Province on Sunday, including from Samsung, Amkor Vietnam, Foxconn Singapore, and Goertek Technology Vina.
1 million: The number of cars the Ministry of Industry and Trade wants to be sold in Vietnam by 2030 according to its new 'Development Strategy for Vietnam’s Automotive Industry to 2030, with a Vision to 2045.' Last year, just under 302,000 cars were sold here.
US$773.5 million: VinFast’s Q2 losses, a 27% increase over Q1.
Extra Links:
Influential Vietnamese environmentalist released from prison two years early (Mongabay)
The Road to Saigon (Cimigo - video)
Why are European renewable giants fleeing Vietnam? (DW)
The geopolitics of Southeast Asia’s green transition (International Institute for Strategic Studies)
Tracing the Roots of Bến Tre's Coconut Candy via My Grandma's Family Tales (Saigoneer)
Have a great weekend!