Give and Take: Vietnam Cracks Down, Opens Up

Writing about Vietnam’s economic fortunes, global law firm White and Case recently began a consideration of foreign investment into the Southeast Asian country, noting that officials revised gross domestic product growth expectations upward after announcing big hikes in foreign investment.

In the same period, however, human rights activists have been ringing alarm bells about the Vietnamese government’s increasingly draconian moves to suppress basic freedoms.

Recently, a court in Vietnam sentenced journalist Trương Huy San – whose pen name was Huy Đức – to two-and-a-half years in prison on charges of “abusing democratic freedoms” in Facebook posts that raised critical questions about the government’s policies, the New York Times reported. His family was kept out of the courtroom during sentencing.

Vietnamese police in 2020 similarly arrested and imprisoned writer and activist Phạm Đoan Trang in the middle of the night, citing her contributions to United Nations reports, added PEN America.

Writers are only one example of the problem, wrote the Washington Post. Lawyers, dissidents, and activists are also suffering under a crackdown that coincides with massive investment into and the expansion of Vietnam’s tech and manufacturing sectors.

Montagnards, an ethnic minority living in Vietnam’s highlands, have also complained about repression against their unique community. Vietnamese leaders have denied those allegations, however, saying the Montagnards represent “extremist organizations.”

The force behind this economic miracle coupled with the repression of human rights is Lương Cường, a former military general who succeeded long-time Vietnamese leader Nguyễn Phú Trọng after the latter died in July 2024, explained the International Institute for Strategic Studies. Cường is one of a cadre of leaders who originated in the party’s security forces and whom Trong hoped would re-instill communist rigor into the Vietnamese state.

He did, say observers. “The rise of a new leader in Vietnam following a power shake-up in mid-2024 brought no reprieve from the government’s relentless repression of human rights,” wrote Human Rights Watch.

Still, Cường is considering reversing one dictatorial rule that his country has adopted in the past. As the Independent reported, he may relax the two-child policy for Vietnamese couples. Vietnam, like communist China, is poised to hit a demographic crisis with too few young people working in the future to support the elderly.

Other economic pressures are likely to blunt the country’s growth, too. In a sign of how an export-driven economy can be vulnerable, Vietnam experienced a rare trade deficit of $1.55 billion in February after generating a surplus of more than $3 billion in January.

In particular, Vietnam’s steel industry faces a double threat from the US after President Donald Trump signed an executive order to impose a 25 percent tax on all steel imports from March 4. Vietnam’s aluminum exporters face a similar surcharge.

Vietnam is the fifth-largest exporter of steel to the US, which is Vietnam’s third-largest market.

“It will lead to Vietnamese companies being greatly affected and Chinese companies will not want to invest in Vietnam anymore,” Norway-based economist Nguyễn Huy Vũ told Radio Free Asia. “Surely Vietnam’s economy will face many difficulties in the coming days.”

As a result, the European Union is planning a charm offensive, seeing Vietnam’s issues as an opportunity.

European leaders such as the European Commission President Ursula von der Leyen and French President Emmanuel Macron are planning visits to Vietnam in the coming months to strengthen ties with the Southeast Asian nation amid tensions with Washington that could impact their exports to the United States.

“The tide of tariffs and export controls is rising,” von der Leyen told top officials from the Southeast Asian bloc ASEAN in a video message as they met in Vietnam’s capital Hanoi in late February. “We want to create new opportunities to trade and invest with trusted partners.”