Kidnapping in Europe: A Step Back for Vietnam-EU Relations

Photo: US Dept of State

The Vietnamese government’s audacious abduction of Xuan Thanh Trinh may have further reaching consequences than PM Phuc thinks.

By Oliver Ward, Edited by Joelyn Chan

In a throwback to Cold-War era Germany, the Vietnamese government orchestrated the kidnapping of Vietnamese businessman, Xuan Thanh Trinh, from a busy Berlin street. A seven-man Vietnamese intelligence team allegedly bundled the former PetroVietnam executive into a van and sped off, re-enacting scenes reminiscent of East Germany under Soviet occupation. German authorities believe the men then transported Thanh to Prague, before flying him back to Vietnam.

Thanh faced charges in Vietnam for financial mismanagement, surrounding the loss of US$150 million during his time at PetroVietnam, a subsidiary of the country’s largest state-run oil conglomerate. He was in the application process for claiming political asylum in Germany.

It has caused tension between the two nations

The kidnapping has led to somewhat strained Vietnamese-German relations. The German government has demanded Thanh’s immediate return, citing the reason that the kidnapping deliberately undermines German sovereignty and her rule of law. It is even more insulting given that Prime Minister Nguyen Xuan Phuc specifically discussed Thanh’s case with German officials in May when he visited Germany for the G-20 summit. Czech police have arrested a suspect and handed the man over to German authorities.

In a move even further aligned with communist regimes of old, Thanh then appeared on Vietnamese state-run television and gave a full confession of his crimes. His lawyer called his confession “forced”.

In response to the abduction, the German government has summoned Vietnam’s ambassador, expelled a Vietnamese intelligence officer and stated that it would consider further action against Vietnam. A Foreign Ministry spokesman called the kidnapping an “extreme breach of trust”, stating it “has the potential to negatively affect relations massively”.

Vietnam has done little more than express “disappointment”. Given the reluctance to issue an apology or accept fault over the situation, chances of Thanh returning to Germany to claim asylum is very unlikely.

The incident comes as Vietnamese-European relations were turning a corner

Part of Obama’s Trans-Pacific Partnership (TTP) promised to reduce tariffs for Vietnamese exports to the United States, but once Trump entered the Oval Office, the deal lay in ruins. After the US pulled out of the TTP negotiations, and in an attempt to diversify trade away from China, the Vietnamese government began pushing for the ratification of the Free Trade Deal with the European Union (EU). The EU-Vietnam Free Trade Agreement (EVFTA) was signed in December 2015 and is due to open the EU up to tariff free trade for Vietnam in 2018, but first, it has to be ratified by the EU Parliament.

The EU has expressed interest in getting the negotiations ratified quickly. The growing middle class in Vietnam and strong desire to shift away from Chinese manufactured goods would open up a thriving market to European manufacturers.

Trade is already increasing. In 2016, Vietnam exported €33.1 billion (US$39 billion) to the EU, with telephone sets, electronic products, clothing, coffee and seafood making up the bulk of their exports.  The EU exported just €9.3 billion (US$11 billion) to Vietnam. They are, however, one of the largest foreign investors in Vietnam, with a total investment stock of US$21.7 billion in the country.

(Source: European Commission)

Improved relations with Europe and the establishment of tariff free trade would generate economic growth and alleviate Vietnam’s reliance on Chinese trade and investment. Such progress may also have positive upshots for Vietnam’s competing territorial claims in the South China Sea and mitigate the successes of China’s chequebook diplomacy in the region.

The kidnapping validates existing concerns about Vietnam’s human rights abuses

Aside from the disregard for German law and order, the kidnapping of a Vietnamese national on foreign soil and forcing a confession from him on state-run television raises yet more questions about Vietnam’s record on human rights.

The EU Parliament already raised concerns in February about ratifying the agreement. The sustained arrest and persecution of online government critics is already an obstacle to the EU Parliament’s decision to ratify the EVFTA. When the EU delegation visited Vietnam in June, they called on PM Phuc to release ‘Mother Mushroom’, a prominent human rights activist sentenced to ten years in prison. The events surrounding the kidnapping will have only compounded European concerns.

Unlike the TTP, releasing a few prisoners and amending a couple of laws will not work with the European Parliament. The EU concerns run deeper than just maintaining the appearance of promoting human rights. The agreement hinges on things like labour rights, and the concerning Vietnamese ban on the free formation of labour unions.

The ratification process should not be taken lightly by the Vietnamese. All 28-member nations have to ratify the agreement with Vietnam individually. It is no small ask. Some nations will have to amend their laws so that the agreement can pass their investment protection regulation. Frederick Burke, a partner in the multinational law firm Baker & McKenzie, said that the agreement would rely more on the “goodwill” of European nations than on specific legal guidelines. In this respect, Vietnam needs all the European allies it can get.

Germany has been one of Vietnam’s strongest backers in Europe

Before this unprecedented abduction case, relations between Germany and Vietnam were flourishing, and Germany was one of Vietnam’s closest European backers. They are Vietnam’s biggest European export partner, exporting more than €260 million (US$307 million) of goods to Vietnam in December 2016 alone.

In 2011, German Chancellor Angela Merkel and then-prime minister Nguyen Tan Dung established a strategic partnership between the two countries and Germany still conducts around 60 meetings a year in Vietnam to offer support for their penal system reforms.

When Prime Minister Phuc met Chancellor Angela Merkel in May, they were able to announce that the Vietnam-Germany Business Forum had negotiated a further US$1.7 billion of new trade deals. Without a healthy Vietnamese-German relationship, it is unlikely the EVFTA would have gotten this far given the questionable record of Vietnam’s human rights abuses.

If Vietnam wants the world to see her as globally responsible, it needs to treat Germany with care

With uncertainty over Britain’s continued membership of the EU, Germany is now by far the most influential country within the EU and will be a powerful ally for Vietnam to preserve until the 28 states have ratified the EVFTA. Even if the kidnapping does not have lasting effects on the EVFTA, and the EU overlooks Vietnamese human rights abuses in favour of increased commerce, Vietnam may have to wait for the dust to settle over the incident before the deal can move forward, incurring yet more delays to the process.

Vietnam has been hoping for a larger role in the international community. They have a seat on the G-20 and were in Germany earlier this year at the last G-20 meeting. Currently, Vietnam has a non-permanent seat on the United Nations Security Council and a seat on the United Nations Human Rights Council. PM Phuc knows that to gain support for their South China Sea claims, Vietnam must be a globally responsible strategic player.

The kidnapping has severely dented Vietnam’s global image, both within Germany and the EU at large. Given the failure of the TTP and the intensification of competing claims over the South China Sea, Vietnam needs to end its reliance on China now, more than ever. With Trump in the White House and the TTP lying dead, the EVFTA represents the best way to achieve this.

Vietnam will need to rely on every ounce of their goodwill capital in Europe to get the EVFTA through the EU Parliament swiftly. While the fallout of the abduction may not cause the whole FTA to collapse, it will undoubtedly have evaporated much of that capital and caused delays.

Vietnamese indifference over the incident is concerning. The Vietnamese government has yet to issue an apology to Germany, and the country’s press continues to report positively on about the EVFTA. The ratification process should not be taken lightly; PM Phuc now has the burden of showing the European Parliament that Vietnam is not a Cold-War era communist human rights abuser. If he cannot do this, he will be looking to German help to keep the EVFTA alive, in the wake of such an irresponsible manoeuvre on German soil, he should not be surprised if his pleas fall on closed doors and deaf ears.

About the Author

Joelyn Chan
Joelyn is a freelance writer based in Singapore. She graduated from Nanyang Technological University with a Double Bachelor in Accountancy and Business. During her free time, she explores the latest developments in fintech and business.