It was the biggest party Saigon had ever seen – a grand celebration marking the 50th anniversary of Vietnam’s reunification, and a showcase of its emergence as a rising economic and diplomatic power in Asia. On Wednesday, some 15,000 military, police and civil defence personnel marched through what is now known as Ho Chi Minh City, cheered by hundreds of thousands lining the streets. Millions more watched the parade live on state television and social media. Dignitaries from around the world were in attendance. But notably absent was a high-level delegation from the United States – a curious omission given Washington’s long-running efforts to strengthen ties with Hanoi amid rising tensions with Beijing. Only US Consul General Susan Burns officially represented the country at the event, after a reported last-minute easing of earlier restrictions on senior attendance. The muted American turnout came at a delicate moment in bilateral ties – with Washington suspending Vietnam war-era aid programmes, threatening sweeping new tariffs on Vietnamese goods, and just weeks after a high-profile visit to Hanoi by Chinese President Xi Jinping. “It’s nuts. What can possibly be achieved by the current administration’s treatment of Vietnam, other than to damage the good will that has been built up over so many years?” said Chuck Searcy, a Vietnam war veteran who has spent the last three decades running aid programmes in the country. “The Vietnamese probably won’t say anything openly, but I’m sure they feel offended.” A divided past The Vietnam war – or “American war”, as it is known locally – was rooted in Cold War geopolitics and colonial-era divisions. The Geneva Accords of 1954 temporarily split the country, but elections meant to reunify it never took place. Instead, it became one of the 20th century’s deadliest proxy conflicts, with millions of lives lost before the fall of Saigon in 1975. “After many years of war, the end came swiftly,” said Carlyle Thayer, an American-born Australian expert on Vietnam who worked as an aid worker in South Vietnam from 1967 to 1968. “It began with an assault on the city of Ban Me Thuot in the Central Highlands in March 1975, and within just 55 days the southern army had disintegrated.” The fall of Saigon on April 30, 1975, brought formal peace and reunification – but also ushered in a new era of hardship for many in South Vietnam. The communist leadership quickly consolidated power, purging not only the defeated southern army but also its former Viet Cong allies. Hundreds of thousands were sent to “re-education” camps, while a mass exodus by sea followed. Vietnam’s post-war turmoil continued into 1979, when it ousted the Khmer Rouge from Cambodia – triggering a bloody border war with China and a decade-long occupation dubbed “Vietnam’s Vietnam”. “At first we thought thank God the war is over,” said Carl Robinson, a former Associated Press journalist who evacuated from Saigon by helicopter with his wife as the city fell. “But there was a lot of recrimination. Even my father-in-law, an anti-government neutralist, was put in a ‘re-education camp’. The north basically humiliated the south and stripped it of its wealth.” From ruin to reconciliation In the post-war years, Washington refused to recognise the new communist government. A trade embargo was imposed, diplomatic ties were frozen and contact was limited to efforts aimed at recovering the remains of missing US soldiers. Isolated diplomatically and constrained by Marxist-Leninist economic policies, Vietnam came close to famine. The crisis spurred the Doi Moi reforms of 1986 – sweeping changes that ended collectivised farming and price controls and ushered in a more open, market-based economy. These reforms accelerated after the collapse of the Soviet Union in the early 1990s, which left Vietnam’s Cold War patron impoverished and largely disengaged. The loss of Soviet support prompted Hanoi to seek new international partnerships, including with the US. Paradoxically, it was the search for the remains of US war dead that opened the door to deeper ties. Shared humanitarian goals helped forge bonds between former enemies. Ted Engelmann, a former US Air Force forward air controller who in 1968 and 1969 directed air strikes for the US and South Vietnamese recalled a 1994 meeting with a North Vietnamese delegation in Denver. “We went to this restaurant, and I noticed that the diplomats and their wives sat quietly on the edge of things. But the vets on both sides recognised each other immediately as soldiers and we started drinking ‘100 per cent’,” he said. “Pretty soon we were drunk, singing, laughing, crying. And we developed lasting friendships that night between people who just a few years ago were trying to kill each other.” That spirit of reconciliation has endured, with Vietnamese and Americans enjoying notably warm ties – particularly among younger generations. Around 70 per cent of Vietnam’s 105 million people are under 50, with little memory of the war or its aftermath. “All that is in the past,” said 54-year-old entrepreneur Nguyen Binh Lien, who has made a fortune selling US health supplements in Vietnam. “We have a house in America, both my children went to prestigious American universities, and now they are American citizens. We love America and Americans.” Growing ties Official relations between the two countries were not “normalised” until 1995 when the administration of US President Bill Clinton officially opened an embassy in Hanoi having lifted the US trade embargo a year later. When Clinton subsequently visited Vietnam in 2000, he was given a rock star’s welcome by enormous crowds that turned out to greet him. Successive US administrations built on that progress. George W. Bush granted Vietnam permanent normal trade relations in 2007, and Barack Obama deepened ties with a comprehensive partnership in 2013, boosting Vietnam’s access to US markets. The US is now Vietnam’s largest export destination. Bilateral trade in goods reached nearly US$150 billion last year, with exports to the US totalling US$136.6 billion – a rise of nearly 20 per cent over 2023, according to the Office of the United States Trade Representative. Major American firms including Apple suppliers, Nike, Cargill, Boeing and Intel have invested heavily in Vietnam’s export-driven economy. But that economic relationship now faces turbulence. US President Donald Trump’s administration has threatened to impose tariffs of up to 46 per cent on Vietnamese goods – targeting Chinese companies that have shifted production to Vietnam to sidestep tariffs on goods made in China. It is unclear how such tariffs might affect Vietnam’s broader economy. Exports to the US account for roughly 30 per cent of Vietnam’s total export earnings. The move also risks undoing the diplomatic gains of previous administrations. In September 2023, then-president Joe Biden became the fourth US leader in two decades to visit Vietnam, upgrading ties with Vietnamese president Vo Van Thuong to a comprehensive strategic partnership – Hanoi’s highest diplomatic tier – amid growing concern over China’s assertiveness in the South China Sea. Caught in between The State of Southeast Asia 2025 Survey Report by the ISEAS – Yusof Ishak Institute found that more than 75 per cent of Vietnamese were concerned by China’s aggressive behaviour in the disputed waterway, while a similar number feared the region was at risk of becoming a battleground for great-power competition. Despite doubts over the US commitment to multilateralism, the poll found some 70 per cent of Vietnamese still viewed the US as a key defender of global rules and governance. And nearly half saw Washington as the leading actor in maintaining the rules-based international order. “The Vietnamese leadership is worried, because the average Vietnamese is toxically anti-China,” Thayer said. “They are angry about China’s bullying in the South China Sea, and have a deep- seated anti-China sentiment that has caused riots and the trashing of shops and the deaths of Chinese nationals.” That resentment complicates foreign policy. Vietnam’s leaders must walk a diplomatic tightrope – recognising the threat from Beijing while wary of US intentions, which they suspect may include regime change, according to Thayer. As a result, Hanoi maintains a strict policy of neutrality enshrined in its “Four No’s” defence posture: no use of force in international relations; no foreign military bases or use of Vietnamese territory for attacks; no siding with one country against another; and no participation in military alliances.