Beijing is carefully managing its relationship with Vietnam after the United States took a harder line on the South China Seadispute and rejected most of its claims in the strategic waterway as “unlawful” last week.  The Beijing-backed Asian Infrastructure Investment Bank said on Friday it would lend US$100 million to the Vietnam Prosperity Joint Stock Commercial Bank to help it expand lending to private businesses disrupted by the coronavirus pandemic.

“From the Vietnamese perspective, it’s probably good for its position and interest if Washington appears to be more assertive and confrontational to China,” said Li Mingjiang, Associate Professor at the S. Rajaratnam School of International Studies. “Strong US positions could help modify China’s claims and position in the South China Sea. Vietnam will be happy to see a US military presence and security role in the South China Sea, which may help prevent the Chinese military from establishing adomination position,” he said.