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 -------------- -- ¶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). BEIJING 00024127 002 OF 002 - 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