PRC SATISFIED WITH PRESIDENT HU JINTAO'S VISIT TO

C O N F I D E N T I A L SECTION 01 OF 02 BEIJING 024127

SIPDIS

SIPDIS

E.O. 12958: DECL: 11/28/2016
TAGS: PREL PHUM ENRG CH VM LA
SUBJECT: PRC SATISFIED WITH PRESIDENT HU JINTAO'S VISIT TO
VIETNAM AND LAOS

REF: BEIJING 18364

Classified By: Political Minister Counselor Daniel Shields.
Reasons 1.4 (b/d).


1. (C) Summary: Chinese President Hu Jintao's November 15-20
state visits to Vietnam and Laos succeeded in strengthening
Beijing's relationship with these two socialist neighbors,
according to MFA officials and third-country diplomats. In
Hanoi, Hu pledged support for Vietnamese efforts to enter the
WTO and to seek a non-permanent UN Security Council seat in

2008. Beijing and Hanoi set up a steering committee to
expand interagency cooperation and address maritime
emergencies. Trade and border deals were also signed. Hu's
23-hour visit to Vientiane was the first by a Chinese leader
since 2000 and produced statements on strengthening political
and economic relations and on border management. Vietnamese
diplomats said Hanoi was irked that Hu did not discuss
PRC-Laos relations with Vietnamese leaders in Hanoi. End
Summary.

Hu Supports Vietnam's International Aspirations
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2. (C) Both Beijing and Hanoi were very satisfied with
Chinese President Hu Jintao's November 15-19 visit to
Vietnam, MFA Asia Department Southeast Asia Division Director
Chen Dehai and Vietnamese Embassy Poloff Tran Viet Thai told
us separately. Hu pledged Chinese support for Vietnamese
efforts to enter the WTO and for Vietnam's bid for the Asia
group non-permanent seat on the UN Security Council in
2008-09, Tran said. China and Vietnam formally established
and held the first session of the interagency Steering
Committee for Bilateral Cooperation that will promote
bilateral cooperation and exchanges, MFA's Chen noted. The
committee, headed by PRC State Councilor Tang Jiaxuan and
Vietnamese Foreign Minister Pham, will work to expand
cooperation across agencies and will respond to emergencies,
such as maritime incidents or detention of fishermen in
disputed areas of the South China Sea, he said.

Border and Trade Issues Emphasized
--------------


3. (C) Beijing and Hanoi reinforced agreements to finalize
demarcation of their land border by 2008, to expedite joint
exploration of oil, gas and fishery resources in the Gulf of
Tonkin and to expand negotiations on demarcation of the
maritime border and resource exploration in areas of the
South China Sea beyond the Gulf of Tonkin, MFA's Chen said.
The two agreed to continue joint naval patrols and joint
surveys for mineral and fisheries resources in the Gulf of
Tonkin in 2007. The joint statement issued by the parties
emphasized strengthening political and economic cooperation
and increasing bilateral trade to $15 billion by 2010. A key
cross-border trade initiative emphasized during the visit
involved sub-regional economic cooperation and development of
transportation corridors between Vietnam and China's Yunnan
and Guangxi Provinces and in coastal regions of both
countries along the South China Sea, he added.


4. (C) In addition to participating in the APEC Leaders'
Meeting, Hu met with Vietnamese President Ngyuen Minh Triet,
Party Secretary General Nong Duc Manh, PM Ngyuen Tan Dung and
National Assembly Chairman Ngyuen Phu Trong. President Hu
has a particularly good relationship with Party head Nong Duc
Manh, Chen said (reftel). During Manh's August 2005 visit to
Beijing, Manh prevailed on Hu to make his attendance at APEC
in Vietnam into a state visit, even though Hu had paid a
state visit to Vietnam as recently as December 2005.

Laos: Five-Point Proposal to Improve Relations
-------------- -


5. (C) Hu Jintao's 23-hour, November 19-20 visit to Vientiane
was the first by a Chinese leader since Jiang Zemin's 2000
state visit, according to MFA's Chen. The goal of the visit
was to demonstrate the PRC's friendship with Laos as an
important neighbor who shares China's socialist system, he
said. Discussions between Hu and Lao leaders focused on
mutual support and trust, with the Lao strongly supporting
China's position on Taiwan, and on China's promises to
continue to provide Vientiane with financial aid, debt
forgiveness and leadership training.


6. (SBU) Hu and Lao President Choummali Saignason agreed on a
five-point proposal for improving relations:

- Maintain annual high-level meetings (Note: Hu's visit
reciprocated the Lao President's June visit to Beijing).

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- Strengthen exchanges for management of national and party
affairs.
- Strengthen economic and trade cooperation and develop new
trade channels. China will encourage investment in Laos.
- Strengthen border security and crackdown on cross-border
crime.
- Provide mutual support on international and regional
issues, including ASEAN and the UN.

Hu also met with former leader Khamtay Siphandone, National
Assembly president Thongsing Thammavong and PM Bouasone
Bouphavanh. A Chinese company signed a $140 million deal to
build a 100,000 kilowatt hydropower station
outside Vientiane during the visit.

Vietnamese see Laos Visit as Incursion on Their Turf
-------------- --------------


7. (C) Hu's visit to Laos was aimed at currying favor and
demonstrating that China can project its influence within
Asia, the Vietnamese Embassy's Thai said. China seeks timber
and other natural resources from Vientiane, he said. Vietnam
remains suspicious that China intends to gain favor in Laos
at Vietnam's expense, he said, noting that President Hu did
not discuss his planned visit to Laos while meeting with
Vietnamese officials in Hanoi. MFA's Chen acknowledged
Hanoi's influence with Vientiane but said China has "no need"
to discuss with the Vietnamese China's relationship with Laos
because China's activities are transparent.
Randt