TNAG-1147-FCO40-1427-UK-policy-towards-South-East-Asia--including-Hong-Kong-1982 — Page 51

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CONFIDENTIAL

reemergence of Vietnam as the dominant power in the region after 1975 and the threat to Thailand's security after the Vietnamese invasion of Cambodia gave renewed impetus to ASEAN's solidarity. Even Indonesia which has always perceived China as more of a threat then Vietnam has been prepared to place its commitment to ASEAN over any cultivation of a special relationship with Vietnam. Because of large disparities in population and stages of economic development, ASEAN is unlikely to develop a high degree of intra-regional economic cooperation but the member states here made considerable progress in harmonising their positions in external economic negotiations.

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ASEAN is likely to remain broadly Western orientated and resistant to Communist influence. The ASEAN countries regard the US bases in the Philippines treaty obligations to Thailand and the Philippines and as a necessary reassurance in the face of growing Soviet involvement in the region. They also appear to welcome Japan's plans to gradually expand its defence capacity and Australia's renewed interest in the security of the region. Soviet Union had China are both regarded warily by ASEAN status because of the Soviet Union's support for Vietnam's occupation of Cambodia and growing naval presence in the area and China's refusal to withdraw moral support from the South East Asian communist partner. ASEAN at present enjoys something like a Chinese quarantee since China has made it clear that it would stand with Thailand in the event of a Vietnamese invasion. But although ASEAN and Chinese interests over Cambodia have temporarily converged, the underlying differences in their objectives would come to the fore if any real prospect arose of negotiations with Vietnam over the future of Cambodia.

Cambodia/Vietnam

6. Time is not on ASEAN's side. The Cambodian resistance coalition is unlikely to make Vietnam more amenable to a political solution or to make much difference to the military situation in Cambodia. Despite the bleak economic future which faces them while the Cambodian problem remains unresolved, the Vietnamese seem determined to hand on. There is already some pressure from Indonesia and to a lesser extent Malaysia to explore the possibilities of compromise. This pressure is likely to grow rather than diminish if the present stale-mate continues. If disenchantment with present policies which exists in some circles in Thailand becomes more wide-spread, there could be a move on ASEAN's part towards opening direct negotiations with Vietnam. If the coalition strategy collapses, ASEAN will have few choices beyond acquiescing in a Vietnamese occupation of Cambodia or accepting a compromise which would leave Vietnam in de facto control of Cambodia but with a reshuffled or restructured government. Vietnam's objective is to consolidate control over Cambodia as a client state and to keep China at bay. The only possibility of a Vietnamese withdrawal from Cambodia would arise in the event of a thaw in Sino-Soviet relations; but this is still a fairly remote prospect.

If the Soviet Union is looking for CONFIDENTIAL

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