The fall of Saigon: How Vietnam ended up in the US orbit

HO CHI MINH CITY, Vietnam — Two stores in downtown Ho Chi Minh City, still popularly known as Saigon, told the story of modern Vietnam one Sunday morning in March.

In a souvenir shop foreign tourists haggled over some of Vietnam’s most iconic T-shirts: Those with the image of Ho Chi Minh, the country’s long-dead father of communism, for instance, and those with the hammer and sickle icon. But down the street in a newly opened Apple store, a crowd of young locals all vied to ask questions about the outlet’s most coveted item: the iPhone 6. And a lucky few with disposable income walked out with their new mobile devices in hands, beaming.

While the hammer and sickle and Uncle Ho’s image may still adorn T-shirts it sells to foreign tourists, Vietnam’s heart throbs for all things American, especially Apple. In 2014, in fact, Vietnam became its hottest market. In the first half of the 2014 fiscal year alone, iPhone sales tripled in this country, far surpassing sales growth in China and India.

But it is not just iPhones, of course, that exemplify America’s powerful presence in Vietnam 40 years after the war ended. Facebook entered Vietnam’s market four years ago and at one point was adding a million signups a month. As of October, it had 30 million users, and that’s out of 40 million Vietnamese who have access to the Internet.

On television too, America has managed to seduce its former enemy. One of the country’s favorite shows is “Vietnam Idol” (in addition to “The Voice of Vietnam” and “Vietnam’s Got Talent”). You don’t need to understand Vietnamese to follow the plot. A rural teenager appears; she’s nervous, full of self-doubt. When she sings, however, we hear a golden voice. Judges swoon. Soon, a few weeks later, she has been transformed, grows in confidence and beauty. See her studied gesture of shyness, the chic skirt, the professional hair and makeup and the flawless performance. The crowd loves her.

From corporate investments to tourism, from military engagements to products, from social media to entertainment media, from the Vietnamese-American expats who return in droves to invest heavily in their homeland to a horde of Vietnamese foreign students coming to the U.S. for a much coveted American education, Vietnam is falling quickly back into America’s orbit.

In 2014 the U.S. overtook the European Union to become Vietnam’s largest export market, buying nearly $29 billion worth of goods, and it sold more than $5.5 billion worth of products to Vietnam.

In October, to deepen ties, Washington eased a ban on weapons sales to its former enemy, mainly to upgrade Vietnam’s naval defenses. It also performed its fifth joint military exercise with the Vietnamese military, despite China’s objections.

China has reasons to be nervous. It now claims 90 percent of the South China Sea, all the way to Borneo, amid international protests. This vast stretch of water provides shipping lanes for more than half of world trade. And for the U.S. alone in 2012, an estimated $1.2 trillion worth of goods transited through it. Under that sea, too, lie untold oil pockets and natural gas, the stuff that could make or break an empire for the next 100 years. But by claiming control over this international body of water, Beijing is spurring a warming of relations between the U.S. and Vietnam.

Much of that cozy relationship can be attributed to Hillary Clinton who, as secretary of state, visited Hanoi in July 2012. “Clinton’s visit paved the way for the establishment of the U.S.-Vietnam Comprehensive Partnership, which was formally laid out a year later in Washington at the July 2013 summit meeting between U.S. President Barack Obama and Vietnamese President Truong Tan Sang,” noted The Diplomat, an Asia-focused news website.

How important is this breakthrough? Very. Less than a decade ago, Hanoi had considered China as its strategic ally, but not anymore. Vietnam is asking to buy more weapons from the U.S. so it can defend itself from China.

Clinton, who’s running for president in 2016, considers the Pacific region the top priority. In “America’s Pacific century,” an essay written for Foreign Policy in 2011, she noted, “One of the most important tasks of American statecraft over the next decade will … be to lock in a substantially increased investment — diplomatic, economic, strategic and otherwise — in the Asia-Pacific region.” All this is to say Vietnam will continue to be a big blip on America’s radar for years to come.

But beyond geopolitics, the Vietnamese have for decades been fascinated with America, thanks in large part to Vietnamese-Americans. An unexpected but crucial consequence of the Vietnam War was the subsequent mass exodus of its people in the aftermath. The largest, wealthiest and most educated Vietnamese overseas population now resides in North America, and in the post–Cold War period, they began to exert powerful influences in Vietnam’s economic and cultural life.

Overseas U.S. remittances average about $12 billion a year, compared with the average $7 billion annually sent to Vietnam from other countries. On top of remittances, however, “overseas Vietnamese have invested in about 2,000 projects, generating about $20 billion annually” notes the Voice of Vietnam, the national radio broadcaster. The combination of overseas Vietnamese remittances and investment amounts to about 18 percent of Vietnam’s GDP.

What this means on the ground is that a sizable population of Viet Kieu — Vietnamese expats, former boat people and their children — now wield considerable leverage in their homeland. From opening wine shops to creating startups, from running high-tech companies to working as executives for major foreign companies in Vietnam, from starting art centers to making movies or teaching at universities, expats have become active agents in changing Vietnam’s destiny.

Epitomizing the trend is Henry Nguyen, 41, who fled Vietnam as a child with his parents and spent months in a refugee camp in Thailand. Eventually he became a Goldman Sachs associate in Virginia. Now he is back in Vietnam, famous for bringing McDonald’s, Pizza Hut and venture capital to his homeland. To top it off, the former boat person who became an U.S. entrepreneur married the daughter of Vietnam’s prime minister in 2006.

The war “forced people who share common values and culture to pick sides,” Nguyen told Reuters recently. “It’s kind of like a tragicomedy.”

Tragicomedy, indeed. Forty years have passed since the Vietnam War ended, and despite a military parade being planned in Ho Chi Minh City, debates rage on both sides of the Pacific as to who really won and who lost that war. Military defeat and victories, after all, don’t mean much in the age of globalization. And by looking at the proliferation of Starbucks and KFC and Burger King and Apple stores on the streets of Vietnam’s major cities, visitors may discern for themselves at least who’s winning the peace.