P 231031Z JUN 09
FM AMEMBASSY HANOI
TO SECSTATE WASHDC PRIORITY 9801
INFO ASEAN REGIONAL FORUM COLLECTIVE
AMEMBASSY BEIJING 
AMEMBASSY CARACAS 
AMEMBASSY MOSCOW 
AMCONSUL HO CHI MINH 
SECDEF WASHINGTON DC
CDR USPACOM HONOLULU HI
CIA WASHINGTON DC
DIA WASHINGTON DC
JOINT STAFF WASHINGTON DC
NATIONAL SECURITY COUNCIL WASHINGTON DC

C O N F I D E N T I A L HANOI 000582 
 
 
STATE FOR EAP/MLS, EAP/RSP, PM/RSAT 
 
E.O. 12958: DECL: 06/23/2019 
TAGS: MCAP PINR PINS PREL RS VM
SUBJECT: BUILDING VIETNAM'S MILITARY DETERRENT WITH RUSSIAN 
ARMS 
 
Classified By: Political Counselor Brian Aggeler, E.O. 12958, Reasons: 
1.4 (b) and (d) 
 
¶1.  (C) Summary.  Increasingly concerned about China's 
assertive behavior in the South China Sea, the Government of 
Vietnam (GVN) is pressing ahead with its military 
modernization program.  To better defend its territorial 
claims and economic interests and present a more potent 
deterrent to Chinese moves in the area, the GVN has 
prioritized the acquisition of more potent air and naval 
assets, including recent purchases of six Kilo class 
submarines and twelve SU-30 fighter jets from Russia.  End 
summary. 
 
Under the Sea 
------------- 
 
¶2.  (U) Admiralty Shipyards in St. Petersburg, Russia, will 
build six Kilo class diesel-electric submarines for delivery 
to Vietnam, the Russian business daily Kommersant reported on 
April 27.  In addition to submarines, reports indicate that 
the Vietnamese Navy will receive new heavyweight torpedoes 
and missiles.  Sources in Rosoboronexport later confirmed 
that Russia and Vietnam had been negotiating a $1.8 billion 
deal for the delivery of the six Kilo-class submarines to the 
Vietnamese navy for about a year.  The South China Morning 
Post added that the deal, if finalized, would complete a 
two-decade effort by Hanoi to obtain Kilos. 
 
¶3.  (SBU) Professor Carl Thayer, a veteran Vietnam military 
watcher with the Australian Defense Force Academy, confirmed 
that Hanoi's desire to obtain Kilos dates back to before 
¶1991.  At the time, Vietnam was in talks with the Soviet 
Union, which collapsed before a deal could be sealed.  More 
recently, Vietnamese naval chiefs sought second-hand Kilos 
from Serbia.  Hanoi reportedly acquired two mini-submarines 
from North Korea in 1997, either for use in commando 
operations or to start a development and training program, 
but the Vietnamese People's Navy does not yet have any full 
size submarines. 
 
¶4.  (SBU) Kilo class submarines, nicknamed "Black Holes" for 
their ability to avoid detection, are among the quietest 
diesel-electric submarines in the world.  The submarine is 
designed for anti-submarine warfare and anti-surface-ship 
warfare, as well as for general reconnaissance and patrol 
missions.  The vessel has a displacement of 2,300 tons, a 
maximum depth of 350 meters (1,200 feet), a range of 6,000 
miles, and a crew of 57.  It is equipped with six 533-mm 
torpedo tubes.  As of November 2006, 16 vessels were believed 
to be in active service with the Russian Navy, with eight 
more in reserve.  Another 29 vessels are thought to have been 
exported to China, India, Iran, Poland, Romania and Algeria. 
 
Venezuela - No Subs for You! 
---------------------------- 
 
¶5.  (C) Several Russian press reports note that these 
submarines were once planned for Venezuela, adding that 
Russia's Rosoboronexport broke a contract with Venezuela to 
supply the submarines after the April 18 meeting between the 
South American country's president, Hugo Chavez, and U.S. 
President Barack Obama, at which Chavez indicated his desire 
to improve relations with the United States.  (Comment: 
Chavez's offer of friendship to President Obama is an 
unlikely and rather thin public rationale for canceling a 
$1.5  billion arms purchase, particularly given that 
Venezuela is one of Russia's top five purchasers of military 
equipment and weaponry.  The sinking global oil market, and 
Venezuela's growing economic dependence on its declining oil 
production for revenue, are far more probable reasons for the 
delay and shift.  End Comment.) 
 
Into the Wild Blue Yonder 
------------------------- 
 
¶6.  (SBU) Less than one month later, a May 14 report from 
Vedomosti newspaper, citing top aviation industry officials, 
stated that Russia has also secured an order from Vietnam for 
12 Su-30 MK2 fighter jets worth more than $500 million 
dollars.  The contract with Russian state arms exporters 
Rosoboronexport was signed in January, according to the paper. 
 
¶7.  (SBU) While the supersonic fighter jets are to be sold 
without on-board weapons, the MK2 version of the Su-30 has 
electronics that enable the use of anti-ship missiles. 
Contracts for missiles and other arms to equip the planes are 
worth hundreds of millions of dollars more.  No timeframe for 
delivery has been confirmed; however, several press reports 
indicated that the first of the aircraft are expected to be 
delivered by the end of the year. 
 
¶8.  (C) Although Vietnam already has twelve Su-30s and 36 of 
the similar Su-27 fighters, most of Vietnam's roughly 400 
warplanes are 1960's era MiG-21 fighters and Su-22 ground 
attack aircraft, making this purchase an important element in 
Vietnam's efforts to upgrade its military forces.  Developed 
near the end of the Cold War, the 33-ton Su-30 is similar to 
the U.S. F-15, but costs about a third less and is recognized 
as one of the better fighters produced by Russia. 
 
Russia: Happiness is a Warm Gun 
------------------------------- 
 
¶9.  (SBU) At the peak of ideological ties between Hanoi and 
Moscow, the three-and-a-half decades between the mid-1950s 
and 1990, the former Soviet Union flooded Vietnam with 
concessionary loans and arms shipments.  The USSR supplied 
North, and later unified, Vietnam with 2,000 tanks, 1,700 
armored vehicles, 7,000 pieces of artillery and mortars, 
5,000 pieces of artillery, 158 missile complexes, 700 
warplanes, 120 helicopters, and more than 100 naval vessels. 
Some three quarters of the weaponry now used by the 
Vietnamese army is Russian.  After the Soviet Union's 
collapse, its military aid was replaced by Russian commercial 
armament sales because Vietnam's 450,000-strong army still 
needs Russian arms and spare parts. 
 
¶10.  (SBU) In 1995, Vietnam bought six Su-27 Flanker fighter 
jets for $150 million and in 1997 signed a contract for six 
more planes and spare parts.  Since then, Vietnam has taken 
delivery of 12 Russian-built Su-30 multirole jet fighters, 
and the recent purchase will bring that total to 24.  Over 
the past few years, Russia has also helped Vietnam beef up 
its navy by providing it with corvettes and guided-missile 
frigates.  With the recent submarine and aircraft contracts, 
Vietnam becomes one of Russia's five largest arms clients, 
alongside India, Algeria, Venezuela and China. 
 
Comment:  Expanding Vietnam's Deterrent 
--------------------------------------- 
 
¶11.  (C) These recently-concluded arms deals fit a pattern 
over the last ten to twenty years of Vietnam attempting to 
modernize its military capabilities.  However, the purchase 
of the six submarines is particularly significant as they 
will give Vietnam a quantum leap in anti-submarine and 
anti-ship warfare capabilities and furnish Vietnam with the 
most advanced undersea warfare capabilities in the whole of 
Southeast Asia. 
 
¶12.  (C) Apart from an overall military modernization effort, 
Vietnam is counting on the submarines to change the military 
equation in the South China Sea.  Vietnam and China generally 
enjoy close relations, but the conflict over sovereignty, 
territorial claims and maritime resources in the South China 
Sea is a persistent source of tension.  While Vietnam cannot 
hope to match China in naval power, it can make any conflict 
over disputed claims a complex and risky proposition for 
China.  The Kilo-class submarines represent an asymmetric 
threat that could potentially deny Chinese control over the 
area if they attempt to seize disputed islands by force. 
 
¶13.  (SBU) Vietnam's ability to afford its new purchases 
remains to be seen.  The recent economic downturn has had 
less of an impact on Vietnam than on many of its neighbors, 
but with a total defense budget speculated to be on the order 
of $3.6 billion, it is unlikely the GVN has the resources to 
pay for the new submarines outright.  More likely, Vietnam 
will pay Russia through a combination of barter arrangements 
and some funds over time. 
 
 
PALMER