Vietnam: Unusual timing of leadership transition but expect business as usual
13 April 2016
Vietnam’s outgoing National Assembly last week voted to dismiss reformist Prime Minister Nguyen Tan Dung and then elected deputy prime minister Nguyen Xuan Phuc as his successor, officially ending Dung’s two terms in office in which he oversaw an extensive reform process that has turned the country into one of the most attractive foreign investment destinations in Asia.
Two days after Phuc’s appointment, the outgoing National Assembly approved 21 new Cabinet positions put forth by Phuc, effectively putting into place Vietnam’s new government.
While Phuc’s appointment to prime minister and the preceding appointments of the new President and new National Assembly Chair were pre-decided in January at the Communist Party of Vietnam’s 12th National Congress, the timing of the new appointments is unusual and represents a divergence from procedural norms in Vietnam’s one party system of governance. Typically, the appointments of National Assembly Chair, President and Prime Minister are officially endorsed by voting procedures in the first session of the new legislature that emerges from National Assembly elections, which are also held once every five years and follow National Congresses. This year, National Assembly elections will take place on 22 May. In short, these recent appointments that have ushered in Vietnam’s next government have been voted in by the outgoing National Assembly as opposed to the new body that will emerge following next month’s elections.
While it is always very difficult to read into the political maneuverings of Vietnam’s opaque Communist Party leadership, Access Asia believes these endorsements were made in the outgoing National Assembly as a cautionary measure to ensure there are no surprises from the new body that will emerge following May’s elections. By doing so, the CPV is ensuring a smooth transition and avoiding any possible political bottleneck by holding the votes in the current National Assembly that it knows and has full control over. Even endorsements by a smaller number of votes (Phuc received 90 percent) could have been read as disunity among the National Assembly and the CPV and/or a weakening of the CPV’s grip on power. With up to 100 self-nominated or independent candidates possibly running in next month’s elections – while allies of Dung and the reformist camp will also stack the new body – the next legislature may be more than a rubber stamp of the CPV’s policies and decisions and thus the party is taking no chances to ensure it fully controls the current leadership handover.
While a planned visit in May by US President Barrack Obama could be a more pragmatic reason for expediting the leadership handover (at a time when both countries are seeking closer ties), foreign policy rarely trumps domestic politics and it would be unlike the CPV to divert from its own policies and procedures simply for talks with President Obama.
No matter the reasoning, Vietnam’s new government is now in place and Access Asia believes there will be little impact on economic policies and the reform process overseen by Dung’s two terms. The Cabinet line-up (as well as the new Politburo) features an encouraging balance of reformists and conservatives, the latter of which will ensure the hallmark of the CPV’s decades-long rule: stability. Particularly from a foreign investment standpoint, it will be business as usual.
