In His Third Year, Can Tô Lâm Actually Remake Việt Nam’s Political and Economic System?

Aug. 3, 2026, marked two years since Tô Lâm became general secretary—the most powerful position in Việt Nam’s political system. [1] In some political systems, two years amount to half a presidential term. In the United States, it is when midterm elections take place, commonly viewed as a test of public confidence in the president and the governing party. 

But politics in Việt Nam works differently. [2] Two years do not necessarily weaken a leader’s authority; instead, they can help him consolidate his rule.

In Tô Lâm’s case, he has accomplished something few leaders in Vietnamese history have achieved. First, he consolidated the positions of general secretary and state president under one leader. [3] He then launched reforms at breakneck speed to realize his ambition of transforming Việt Nam into a developed country. [4] The past two years have proven that a bureaucracy many regard as slow-moving can still implement sweeping changes when one individual concentrates power.

This unprecedented pace prompted longtime Việt Nam scholar Carl Thayer to make an intriguing comparison. Thayer said that he did not want to call Tô Lâm “Việt Nam’s Donald Trump” but described him as a leader seeking to concentrate power so he could make decisions rapidly. [5] The similarity Thayer identified was not ideological or stylistic, but rather about how leaders use power to push through rapid and sometimes headlong changes.

Now that he holds extraordinary power, Tô Lâm must demonstrate that his promised reforms are more than a means of consolidating his authority. Greater power brings greater responsibility, and in the coming years, the system will be tested to see if it can help the country develop. 

Moving forward, Tô Lâm faces challenges on three fronts: constraints within the political system, risks created by his own reform agenda, and an increasingly unstable world.

Power is Not Absolute

After consolidating the positions of general secretary and state president, it is easy to assume that Tô Lâm holds absolute power and faces virtually no rivals. Yet several signs suggest that this conclusion may be premature. 

A study by Nguyễn Khắc Giang of Singapore’s ISEAS – Yusof Ishak Institute noted that the composition of the Central Committee and Politburo remained largely unchanged following the 14th Communist Party Congress in January. [6] Provincial leaders retained considerable influence, while the military and public security apparatus continued to occupy a massive share of the political elite. Notably, Defense Minister Phan Văn Giang’s concurrent appointment as a deputy prime minister further elevated the military’s position within the government.

On a political commentary podcast hosted by Trịnh Hữu Long, analyst Nguyễn Anh Tuấn suggested that developments surrounding the arrest of Nguyễn Thành Nam—along with Tô Lâm’s failure to discipline any senior military leader—could indicate that his authority over the military is being challenged. [7] 

Furthermore, before the Party Congress, Reuters sources reported that military leaders sought to preserve a broad degree of autonomy. [8] While this report does not definitively prove the existence of a secret agreement, it suggests that describing Tô Lâm’s power as “absolute” goes too far.

Tô Lâm’s continuation of the “blazing furnace” anti-corruption campaign—initiated by the late General Secretary Nguyễn Phú Trọng—presents another paradox. While corruption cases continue, the campaign has lost intensity at the highest levels as Tô Lâm pivots toward approving projects and promoting economic growth. [9] This shift may help address the reluctance of officials to sign documents or make decisions after years of political purges. [10] 

However, if the “furnace” cools too quickly, the massive projects approved in pursuit of growth could easily become new sources of corruption. Tô Lâm may have mastered the political system, but this does not necessarily mean he has made it function any better. [11]

The Price of Ambition

It is no exaggeration to say that Việt Nam has undergone a dramatic transformation during Tô Lâm’s first two years. Since July 2025, Việt Nam’s administrative map has included only 34 provinces and centrally governed cities following the elimination of the district level. [12] This restructuring arrived alongside extensive changes to taxation, investment procedures, and the promotion of large infrastructure projects. [13] [14] [15] 

While the government claims that eliminating about 145,000 administrative positions saved approximately 39 trillion đồng in annual recurrent spending, [16] the broader effects remain unclear. For instance, nearly 24,000 businesses completed dissolution procedures during the first six months of 2026—an increase of 94.7% from the previous year. [17] Even if this figure does not definitively prove that the reforms caused the closures, it underscores the need for serious assessments.

This situation poses a direct challenge to Tô Lâm’s ambition of achieving double-digit economic growth. [18] Việt Nam’s economy grew by 8% during his first year in power, and the World Bank forecasts growth of only 6.8% in 2026, [19] [20] both of which fall short of his 10% annual goal. Việt Nam may be able to generate short-term spikes through public investment and credit expansion, but sustaining double-digit growth requires higher productivity and more competitive businesses. [21] 

To achieve this, Tô Lâm has relied on “leading cranes”—massive private conglomerates capable of undertaking major infrastructure and technology projects. [22] The logic is sound, as mega-projects demand immense capital and organizational capacity. However, if land, credit, and public contracts lack transparent distribution, this strategy risks devolving into a system of privileges for conglomerates connected to state officials. [23]

This centralization of economic power has been mirrored by an equally aggressive contraction of civil liberties, as arrests and penalties regarding free speech have surged. 

According to Project88 figures cited by The Associated Press, Việt Nam recorded 56 politically motivated arrests in 2025, effectively doubling the number from 2022. [24] More recently, in July 2026, five people were arrested for publishing Chuyện với Thanh, a book about Hồ Chí Minh that authorities accused of distorting history and insulting the national leader. [25] 

The government may argue that controlling expression is necessary to preserve national stability; however, stability built on fear and self-censorship carries a cost. When a society becomes too cautious to express its opinions, it becomes impossible to distinguish genuine consensus from fear.

Bamboo Diplomacy Faces a Test

For years, Việt Nam successfully navigated its relationship with the United States and China by maintaining a delicate equilibrium: exporting tens of billions of dollars in surplus goods to the United States [26] while importing far more from China than it exported. [27] This arrangement allowed Hà Nội to maintain stable economic and political relations with both powers. However, President Donald Trump’s second term has made that balance far more precarious. 

Following repeated tariff negotiations, a 46% U.S. tariff announced in April 2025 was reduced to 20% in August 2025, 10% in February 2026, and eventually 12.5% in July. [28] [29] [30] [31] Yet, this volatility may not be over, especially since Việt Nam’s trade surplus with the United States reached $75.3 billion during the first half of 2026—a 21% increase from the previous year. [32] As the Trump administration actively seeks to reduce U.S. trade deficits, such an imbalance is impossible to ignore. [33]

This growing surplus has intensified suspicions that Việt Nam is serving as a transit point for Chinese goods evading U.S. tariffs. Consequently, the United States has launched investigations into intellectual property protections, manufacturing capacity, and goods potentially linked to forced labor. [34] 

For an economy heavily dependent on exports and foreign direct investment, this uncertainty threatens the broader manufacturing environment. Interestingly, Hà Nội has pursued an equally pragmatic form of diplomacy alongside these formal trade negotiations. While tariff talks were underway, the government advanced a Trump-branded golf resort project worth about $1.5 billion in Hưng Yên, Tô Lâm’s home province. [35] Although there is no public evidence proving that the project was a direct diplomatic maneuver, public concerns regarding a conflict of interest are certainly not unfounded.

Before tariff conditions could stabilize, another geopolitical shock emerged. The war involving the United States, Israel, and Iran disrupted shipping through the Strait of Hormuz, driving up oil prices and triggering an energy crisis in Việt Nam in May. [36] This disruption exposed a limitation in Tô Lâm’s growth ambitions: establishing ambitious economic targets means little when the nation remains heavily dependent on imported fuel. 

Ultimately, this leads right back to China. During the first half of 2026, Việt Nam recorded a $77.3 billion trade deficit with China, mirroring its $75.3 billion surplus with the United States. [37]

This near-parallel rise in Chinese imports and U.S. exports only reinforces Washington’s fears that Chinese materials are being “laundered” through Việt Nam. While Hoàng Thị Hà of the ISEAS – Yusof Ishak Institute notes that this trade surplus partly reflects supply chains legitimately moving away from China, [38] Việt Nam remains deeply dependent on Chinese materials, machinery, and investment. 

Meanwhile, Hà Nội and Beijing are drawing increasingly closer. [39] Shortly after becoming state president, Tô Lâm traveled to Beijing to promote cooperation in railways, energy, artificial intelligence, and semiconductors. [40] The foreign policy paradox is now unavoidable: Việt Nam needs Chinese inputs to sustain production, but deeper integration into Chinese supply chains makes it incredibly difficult to convince Washington that Vietnamese products are not a back door for Beijing. Conversely, the more Hà Nội complies with U.S. demands, the greater the risk of alienating China.

---

Uyển Thanh wrote this article in Vietnamese and published it in Luật Khoa Magazine on August 3, 2026. The Vietnamese Magazine translated it into English.