VIETNAM IN TRANSITION: PROSPECTS FOR AND IMPLICATIONS OF REFORM

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP92T00306R000200120002-7
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 6
• Document Creation Date: December 27, 2016
• Document Release Date: July 2, 2013
• Sequence Number: 2
• Publication Date: July 1, 1988
• Content Type: SNIE

Declassified in Part - Sanitized Copy Approved for Release 2013/07/02 : CIA-RDP92T00306R000200120002-7
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Vietnam in Transition:
Prospects for and
Implications of Reform (C)
Special National Intelligence Estimate
Key Judgments
These Key Judgments represent the views
of the Director of Central Intelligence
with the advice and assistance of the
US Intelligence Community.
Secret
SNIE 14.3-88W
July 1988
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The following intelligence organizations participated
in the preparation of these Key Judgments:
The-Central Intelligence Agency
The Defense Intelligence Agency
The National Security Agency
The Bureau of Intelligence and Research, Department of State
The Office of Intelligence Support, Department of the Treasury
also participating:
The Deputy Chief of Staff for Intelligence, Department of the Army
The Director of Naval Intelligence, Department of the Navy
The Assistant Chief of Staff, Intelligence, Department of the Air Force
The National Foreign Intelligence Board concurs,
except as noted in the text.
The full text of this Estimate is being published
separately with regular distribution.
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Key Judgments
We believe that Vietnam?at least for the next few years?intends to
concentrate on domestic reform and pursue a diplomacy that is generally
more conciliatory and principally focused on expanding and diversifying its
economic ties. While Hanoi is unlikely to foreswear military posturing
entirely, we believe Vietnam is moving toward a new security framework in
its own Indochina backyard that is much less dependent on military
domination.
The economy has been reduced to virtual paralysis, spawning widespread
deprivation and a deep-seated malaise that has infected all levels of the
society. General Secretary Nguyen Van Linh has instituted a broadbased
program of domestic reforms not unlike Gorbachev's perestroyka and
glasnost policies?so far to little effect. The overall situation has actually
deteriorated over the past two years.
We believe several factors militate against a rapid economic turnaround
for Vietnam:
? A weak economic infrastructure, including a limited capacity to absorb
foreign aid or investment.
? An inability, thus far, to implement effectively its reform initiatives.
? An inability to expand agricultural production much beyond present
levels.
Linh and other senior officials concede that reforms will not have any
discernible impact for at least four or five years. Although improvements in
some sectors are possible in the short term, we find Linh's prognosis to be
optimistic.
A far less likely prospect, in our view, is the early stabilization of the
current economic chaos, followed by a period of sustained growth fueled by
large infusions of international aid. While Japan, France, and others have
expressed interest in an international consortium, at least several years of
efforts focused on infrastructure development would be necessary to
stimulate real growth.
We also do not rule out the possibility of widespread popular agitation and
rioting should the living standards of most Vietnamese continue to decline.
While the security apparatus probably could contain such outbursts, the
unrest could engender a serious backlash by conservative leaders against
the reform program and its proponents.
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The new leadership increasingly has also come to view the conflict in
Cambodia as a costly and counterproductive venture that is militarily
unwinnable. Although Hanoi probably does not expect substantial savings
from a military pullback from Cambodia, particularly early on, it does
believe that the conflict in Cambodia distracts attention and resources
from urgent domestic problems, and blocks meaningful access to the
Western and Japanese aid, trade, investment, and technology it needs to
forge an economic recovery and development strategy.'
Despite the deep hostility in Vietnam's relationship with China, there
appears to be grounds for, and some signs of movement toward, an eventual
accommodation with Beijing. Hanoi's pledge to withdraw from Cambo-
dia?when met?will resolve a central point of contention with China.
Vietnamese officials seem resigned, nonetheless, to the probability that
Beijing will dictate a relatively slow pace toward full normalization.
However, disputes over the Spratly Islands could derail even these modest
efforts.
We see little reason to suspect that Soviet influence in Vietnam will decline
over the near term. Moscow will remain Hanoi's main aid donor, and we
have no evidence that the Soviets are prepared to take drastic steps, such as
cutting aid to force Vietnamese compliance on issues of Soviet concern.
Nevertheless, occasional tensions will arise, particularly over aid and Sino-
Soviet relations, and residual nervousness exists in Hanoi that Moscow
could sell Vietnam's interests short in favor of improved relations with
Beijing.
We judge that Vietnam's break with the past in its domestic and foreign
policies has important implications for the United States. If, as expected,
diplomatic momentum on Cambodia continues to gather, there will be
increasing pressure in the near term from the Association of Southeast
INR basically agrees with the analysis of Vietnam's economic and domestic political
condition, but we believe that this Estimate overstates the linkage between Hanoi's
economic straits and flexibility in its Indochina policy. Vietnam's security policy never
envisioned indefinite military occupation of Cambodia and Laos, but rather, the emplace-
ment of pliant regimes in both these countries. Hanoi's recent willingness to revise its
approach to a Cambodian settlement, in our judgment, represents a tactical response,
rather than a major strategic shift, as implied in the main text. INR believes Hanoi's
leaders have decided to step up withdrawals and possibly facilitate the settlement
process?even at some risk?partly in response to domestic problems and Soviet urgings,
but also for what they judge are positive factors and opportunities: the balance of power in
Cambodia rests with Vietnam and the People's Republic of Kampuchea, Sihanouk is
clearly anxious to return to Phnom Penh, the non-Communist resistance is weak, and there
have been signs of softness in the consensus of the Association of Southeast Asian Nations.
We believe that Hanoi is very unlikely to accept a negotiated settlement in Cambodia that
seriously compromises its Phnom Penh clients or risks a major Khmer Rouge resurgence.
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Asian Nations and others for a more direct and prominent US involvement
in resolving the issue. Even Hanoi and Moscow have expressed support for
greater US participation in achieving and guaranteeing an accord. Given
the large number of competing interests, there are risks that the United
States may at times be pulled in opposing directions by friendly, as well as
by adversarial parties. The complex maneuvering of Cambodia's Prince
Sihanouk, in particular, appears to hold such potential, as does the
resolution of the Khmer Rouge role in a settlement.
Vietnam is also likely to press for rapid normalization of relations with the
United States after Vietnamese troops are withdrawn from Cambodia.
Although Hanoi views improving relations as an important component of
its overall strategy for emerging from its isolation, it probably holds out
little hope for major US Government aid. Hanoi will, however, attempt to
exploit any diplomatic headway on Cambodia to pressure Washington to
drop its opposition to international aid, trade, and investment.
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