 Good morning. I'm Ernie Bauer, the Senior Advisor and Director of the Southeast Asia Program here at CSIS. And we're very fortunate this morning to have a visitor from Australia, Dr. Carl Thayer, who's the Professor Emeritus at the University of New South Wales, and also with the Australian Defense Forces Academy. Is that right? Dr. Thayer is a well-known expert on Southeast Asia, in particular Vietnam, and I wanted to ask you a couple questions about your outlook for Vietnamese politics after the Party Congress that just happened earlier this year. A lot of people in this town think that Vietnam has taken a turn for the more conservative after the Party Congress. Others think they see continuity. Could you share where you think Vietnam is headed after the Party Congress? Well, in a nutshell, the Central Committee, the vast majority of members are incumbents and are returning, 42% are new. So there's continuity. On the Political Bureau, 9 of the current 14 represent continuity. And Vietnam is not going back. It's actually addressed and agreed to be more proactive in pursuing international integration. And that simple phrase really means a full court press now to carry on from the remarkable success and opening to the outside world, but not leaving areas outside of the economy, such as defense and security, neglected. So they're broadening their engagement? Absolutely. Across the border. And that obviously includes the United States and Australia, but not exclusively so for either. No, I think Vietnam, they want to make friends with all countries of the world as the kind of aphorism that they use, but in reality, to mask working with great powers, they also want to build up relationships with other countries. So it's not to be isolated. And in that context, Vietnam's chairmanship of ASEAN last year was remarkable in many ways. They were seen as strong leaders of ASEAN, and they really had some important accomplishments. And could you comment on, you know, what are some of the most important things the Vietnamese did, and why were the Vietnamese so focused on ASEAN? Right. Well, I think two events stand out for me. One was they picked up a process where the ASEAN defense ministers, which had met for the first time in 2006, the last sectoral group in ASEAN to do so, reached a decision that there were areas in the defense field where they needed to cooperate with dialogue partners to enhance what they were doing. Vietnam picked up the ball and went running and convened the inaugural meeting and got eight players at the table, including China and the United States, at a time when both those countries had fictions. We're able to keep the South China Sea off the formal agenda, but individual ministers raised it so they had their cake and ate it too. The meeting set up five expert working groups, which will continue the process. Time will tell whether that's successful. They got that off the ground. And then they presided over the East Asia Summit, which has been going since 2005, but that organization made the momentous decision to invite Russia and the United States to join, knowing full well that the United States would agree. And so the United States has a seat at the table as a major plower in the Asia-Pacific, not excluded from East Asia. Right. I was really amazed last year when Vietnam... Not amazed, but I was sort of reassured, I guess, when Vietnam agreed to become a full member of this regional trade negotiation called the Trans-Pacific Partnership, or the TPP. I think they agreed to be a full member in November, which is only months ahead of their own party Congress. So it looked like a pretty big commitment to regional economic integration. But are the Vietnamese biting off more than they can chew with the TPP membership? Well, for a country that was totally dependent on the Soviet Union, it collapsed. And without skipping a heartbeat, opened up to the Northeast Asia first and then globally and did so successfully, taking on the TPP is a similar challenge that I think they have already in their experience ability to do so. They've identified long ago the threat of falling behind economically other countries as a major concern for them. They're dead set in the party Congress and door signing multiple free trade agreements, putting pressure, putting stress on the TPP, because Vietnam needs to find comparative advantage globally. Massive trade deficit with China, it needs other markets. Turning now to the security side of the relationship. One of the aspects we've seen in the U.S.-Vietnam relationship is a real maturity of the security dialogue. But is it possible to normalize mill-to-mill relations between the United States and Vietnam? And if so, in what sort of timeframe and what issues should we be thinking about as Americans? Well, it's possible, but it's not going to be as fast as the United States would like. There's considerable reluctance inside Vietnam. Not because people who have concern are anti-American, is that they fear Chinese reaction and they always have to balance the two. And secondly, America is so big, they're just fearful. They can be taken for a ride or signed on to something and be entrapped in a way that they don't want to. But they made a commitment to open up and they need human resource training, so a big area for them would be to take advantage of what the United States has already put on the table, IMET, extended IMET, and send officers, not in small numbers, but in much larger numbers to the United States. And second, since they've now begun doing search and rescue exercises with China, they've broken the ice. They're fearful that they're backwards, but I think they could work with the United States Navy and several regional programs, carrot, for example, that both sides can agree on. I think they're ready, willing, and able. There's a younger mindset that's there that's empowered by new leadership in the military for this international integration that I talked about to advance that in the military sphere. Sounds like an important time to engage. And one of the things that apparently has driven American engagement with Vietnam and in Southeast Asia over the last 18 months, at least, has been concerns over South China Sea. Could you talk a little bit about that from the Southeast Asian perspective? Why do they want the Americans engaged if they do? And where do you think we stand now post last year's ASEAN Regional Forum? Over the last several years, China has become more assertive. It's modernized and begun to shift military exercises so they begin to intrude in Southeast Asia and in South China Sea waters. Regional states want reassurance and want greater transparency from China. They're not entirely getting it. And in the Vietnamese case, aggressiveness by China and doing unilateral fishing bans has hurt the Vietnamese fishing industry. And they feel the issue should be internationalized, that ASEAN had signed a declaration on conduct of parties with China that it would have been a good confidence-building measure but not implemented. So Vietnam and its leadership in ASEAN in a very subtle way helped to internationalize the issue and put China on the back burner. Secretary Clinton made a very major intervention which spurred then China and ASEAN to try to revive a joint committee that had been moribund to try to work on that. So that's of concern. Two, Vietnam wants to develop its exclusive economic zone. And American oil companies that wanted to assist in that development were threatened by China and that caused an early intervention by Obama administration officials. And Vietnam was absolutely delighted to see the U.S. backing the right of those companies to do business with Vietnam in its exclusive economic zones. It's vital for its own maritime development because it has a long extended coastline and they wanted to integrate the land with the maritime domain and that would contribute up to 50% of GDP in 20, 30 years' time. So it's big stakes for Vietnam and they wanted also an American presence to keep the region stable. Does ratifying the United Nations Convention on the Law of the Seas for the United States, is that an issue that matters for our credibility as for Americans? Well, it does. One, we know the U.S. Navy adheres to the unclos, but the United States gives interpretations of international law based on unclos, lectures China and others see it a bit, well, why don't you sign on to it yourself if you're going to lecture China and what law should apply? So I think the United States would be in a stronger moral and legal position if it's signed on to unclos. I agree with you, by the way. And my last question, since you're here in Washington, if President Obama calls you over to the White House and says, Dr. Thayer, I'm about to do my first East Asia summit in Jakarta this year, what are the three things I should be thinking of in terms of my approach and my strategy to go into EAS? What would you recommend to the President? Well, one, thorough preparations that the United States works with the leading players rather than comes on board with ideas of its own that haven't been pre-cooked and looked at. Two, look very carefully at the concerns that regional states are raising that might not be American priorities, but understand there has to be a trade-off for America to get what it wants. It has to be sensitive to the concerns of other states. For example, regional views on climate change, coral reefs, that seem tangential to the agenda, and I was thinking the U.S. is back, I'll say a lower Mekong initiative, but there are other things that come out of that where the U.S. is funding stuff on the river but on infrastructure, and they have those concerns. The third thing would be that for the East Asia summit to really work, it is congruent with the ASEAN Defense Ministers Plus process. So a strategic head of state, head of government level direction could be given to defense ministers who have been kept out of the regional security architecture recently to get together and shake down the overlap of what's occurring and try to firm it up to save resources, concentrate humanitarian assistance disaster relief in one area, safety maritime issues in another would be a good start because once the heads of state have done that, ministers follow through and everybody down the chain of command gets their marching orders. Well, Carl Thayer, tremendously thoughtful ideas and I really appreciate your taking some time to talk to us at CSIS this morning. Thank you very much for joining us. Thank you. Thanks.