By: David Brown

Vietnam faces a highly political year in 2015. Inside and outside its Communist Party, elite attention is riveted on the likely outcomes of the party congress that will convene in January 2016.

Political decisions are monopolized by the party, by law Vietnam’s only political party and “the force leading the State and society”. Current leaders are the successors of the revolutionaries who led Vietnam to independence and, 40 years ago, to unification. That’s ancient history to three quarters of the nation’s population.

The party’s claim to rule now depends on its ability to solve 21st Century problems. Though the internet has broadened the space for political discussion (and has enabled a vocal crowd of dissidents and regime critics), Vietnam’s 90 million citizens still show no appetite for political upheaval. Relative prosperity has dimmed but not erased memories of 30 years of war and the privations then and later. The Vietnamese are inclined to accept a high degree of state control as long as the party can deliver stability and prosperity.

Stability is not in question. The regime’s instruments of political suasion are pervasive. Prosperity – that is, sustaining economic growth in the order of 7-8 percent annually and distributing that growth equitably – Is less certain. Economists agree that policies that leverage Vietnam’s advantages – in particular its young and disciplined workforce – should enable explosive growth.

However, the Hanoi regime has stumbled in recent years. A bet that it could build a few state enterprises into internationally competitive companies did not pay off. At almost the same time, a misguided effort to spend its way out of global recession failed badly, leaving thousands of stalled real estate projects and saddling banks with non-performing loans. Hammered by inflation and high interest rates, the public was unhappy. In 2012, criticism of government policies was heard in every street corner cafe and seen in hundreds of dissident blogs.

In the Vietnamese party/state, power is concentrated in the party’s Politburo. Hoping perhaps to raise the public mood, Prime Minister Nguyen Tan Dung’s Politburo colleagues set him up as the fall guy. Dung came up short — reportedly 3 for and 11 against — in a Politburo vote. The Prime Minister appealed to the Party’s 200-man Central Committee, called in all his IOUs and won a vote of confidence. Since then, he’s been the man to beat.

The party conducts its business in private but bits and pieces leak out steadily into the cybersphere. These suggest that intra-party factional antagonism remains at an unusually high pitch. It has been a quarter-century since there were such sharp differences in orientation within the Party leadership. It boils down to argument over three issues: managing China, managing state-owned enterprises, and managing dissent.

Simply put, a faction centered in the Party apparatus is generally conservative and a faction centered in government institutions is by contrast described as “open-minded”. For convenience, we will call these the party faction and the government faction.

Managing China: A renascent China, determined to assert hegemony over the South China Sea, if not over all of Southeast Asia, poses a grave strategic threat to Vietnam. Maintaining Vietnam’s national identity and integrity vis-a-vis foreign invaders – chiefly Chinese – is the liet-motif of the nation’s long history.

The party faction counsels restraint in the face of Chinese provocations, reasoning that Beijing commands overwhelming military and economic power and, though the interest of other powers in the region will wax and wane, China will always be uncomfortably adjacent. The government faction has pursued “strategic alliances” with like-minded Asean partners, Japan, Australia, India, South Korea and especially the United States – all in order to balance Chinese ambitions.

Managing State Enterprises: Vietnam’s state-owned enterprises command key sectors of the economy and absorb resources while creating relatively little wealth. On economic restructuring, the party faction tends to see state-owned industries as “an important tool for the implementation of policies” and less of a problem than endemic corruption.

General Secretary Nguyen Phu Trong has campaigned to sideline corrupt party cadres. Prime Minister Nguyen Tan Dung, meanwhile, has pledged to break the state’s bonds to the public enterprises that command key sectors of the economy, chiefly by forcing them to sell shares and publish transparent accounts. Neither Trong nor Dung has been conspicuously successful to date.

Managing dissent: The party faction favors tight supervision of print and broadcast media, repression of dissident bloggers, and stiff punishments for anyone who dares to advocate multiparty democracy. The government faction seeks to control the state’s narrative with a lighter hand.