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In the last few years, Japan-Vietnam relations have entered a new stage. Japan has been the biggest donor country of Official Development Assistance (ODA) to Vietnam. In this new stage, bilateral relations have become more comprehensive by encompassing politics and security as well. On the occasion of Secretary-General Nong Duc Manh's official visit to Japan in April 2009, for example, the two countries agreed to pursue "Strategic Partnership Dialogue," and the first Dialogue was held in Hanoi in December 2010. This is taking place against a background of a changing strategic balance among China, India, Japan, and the United States. Especially noteworthy is China's rapid military build-up and hard-line behavior in the region.

Since the collapse of the Soviet Union, Vietnam has been pursuing a foreign policy of "expansion, diversification and multilateralization" and trying to engage China through bilateral consultations as well as multilateral forums such as Asia-Pacific Economic Cooperation (APEC), the ASEAN Regional Forum (ARF), ASEAN Plus China, and the Greater Mekong Subregion (GMS). These efforts have produced some positive signs, including bilateral agreements on land and sea borders. The unequal distribution of power between China and its neighbors, however, severely limits the effectiveness of engagement with China, resulting in deep frustration and uneasiness in Vietnam. Thus Vietnam is now putting more emphasis than ever on maintaining a regional balance.

Recent developments in US-Vietnam cooperation in various fields are an indication of this. Among these developments, the visit of a US aircraft carrier and destroyer to Danang and a joint exercise between the two navies in August 2010 were particularly notable. The US has taken several steps to boost its military relationship with Vietnam as part of a broader strategy aimed at solidifying its influence in East Asia. At the ARF meeting in Hanoi in July, Secretary of State Hillary Clinton declared that the US had "a national interest" in ensuring "freedom of navigation" in the South China Sea. Another noteworthy move was the decision to open repair facilities for foreign naval ships and submarines at Cam Ranh Bay. Besides its economic purposes, the establishment of this center will enable naval exchanges between Vietnam and other countries.

The most important strategic relationship in East Asia is that between the US and China. This does not deny, however, the necessity for Japan to put an end to its prolonged low-profile posture and accept a more positive role in international politics. Japan and Vietnam share a common interest in ensuring that the changing strategic balance in East Asia does not become detrimental to stability and security in the region. To that end, the two countries should be able to work together in at least three fields.

Firstly, Japan and Vietnam should encourage US involvement in establishing fair and effective rules for the South China Sea. At the ASEAN Plus Defense Ministerial Meeting (ADMM+) held in Hanoi in October 2010, US Secretary of Defense Robert Gates offered to help facilitate discussions between ASEAN and China on the Code of Conduct of Parties in the South China Sea (COC). Such an offer is highly understandable as the US, along with other countries such as Japan and South Korea, is a legitimate stakeholder in the stability and security of the South China Sea. Given the huge gap in power between China and her neighbors and the still low level of security cooperation in East Asia, the US strategic presence will be an indispensable basis for developing fair and effective rules for the South China Sea.

Secondly, in addition to US involvement, it would be advisable for Japan and Vietnam to pursue defense cooperation to enhance Vietnam's defense capability. The intention would be to persuade China not to use force by convincing it that it would not be able to achieve its operational objectives at low cost. Such a "denial" capability would make it difficult for China to coerce its neighbors. From this point of view, cooperative programs, including joint exercises for search and rescue operations, would be beneficial for both countries. Carefully managed arms exports could also contribute to stability and security in the region. Japan has already reached a vessel transfer agreement with Indonesia as a means of countering terrorism/piracy.

Thirdly, strengthening economic cooperation could also have strategic dimensions. Developing Vietnam's export industries will help keep it from being overwhelmed by China in competitiveness. Japan and Vietnam should avoid a heavy dependence on China that would narrow both countries' freedom of action. Cross-border development in the Mekong region will contribute to the establishment of an ASEAN Economic Community (AEC) by narrowing the "development gap" among ASEAN members. The bilateral agreement on cooperation in the development of the rare earths industry in Vietnam through joint geological investigation is also encouraging.

Both Japan and Vietnam hope that the rise of China will be peaceful. More precisely, Japan and Vietnam have no wish to live under a "Pax Sinica." Dealing with the rise of China should not be limited to one approach. Engagement has been, and will be, the basic policy to ensure peace and prosperity in the region. It must be noted, however, that balancing is a key to successful engagement. Japan and Vietnam should cooperate in this regard as well.

Takayuki Ogasawara is Professor of International Relations at Yamanashi Gakuin University, Kofu.

The views expressed in this piece are the author's own and should not be attributed to The Association of Japanese Institutes of Strategic Studies.