Scenarios

Highly likely: Managed succession and continuity

In this scenario, Mr. Lam gradually consolidates power ahead of the party congress in 2026. He would then likely assume the post of general secretary for a full term. Mr. Lam would stay true to the general priority list outlined in his inaugural speech. This includes carrying forward the policies of his predecessor Nguyen Phu Trong, such as continuing the anti-corruption campaign and recalibrating the country’s economic policies. 

There would also be no major changes in Vietnam’s foreign policy, with its so-called “bamboo diplomacy” approach resting on a hierarchy of carefully calibrated relationships, including comprehensive strategic partnerships, traditional friendships and neighborly ties. 

Thus far, despite Mr. Lam’s background in the Ministry of Public Security – a part of the government perceived as being close to China – he has been receptive to efforts by Western partners, including the U.S., to strengthen ties with Vietnam. Indeed, he and his team have eagerly shown his capacity to travel extensively, compared to the late Mr. Trong, whose travel was limited toward the end of his tenure.

During his closely-watched debut speech at the United Nations General Assembly, Mr. Lam explicitly linked Vietnam’s domestic and foreign policy visions through five priorities: equitable development; new global governance frameworks; innovative, futuristic thinking; and people-centric action. The country will likely be under increased scrutiny during engagements like the second iterations of a new international defense expo and a new ASEAN-related forum.   

Less likely: Contested transition and economic challenges

This less likely scenario could emerge if tensions build up before and during the party congress in early 2026, resulting in political maneuvering meant to check Mr. Lam’s growing influence. Such contestation is not uncommon in Vietnamese politics. But a prolonged period of uncertainty would undermine political stability and economic growth. 

Under this scenario, foreign businesses would likely maintain a presence in Vietnam but hedge their bets by seeking other neighboring markets in Southeast Asia and the wider Indo-Pacific region. Vietnam is an attractive location, but countries like Malaysia and Thailand are also competing to draw investors to important sectors such as semiconductors and critical minerals. 

While less likely, this scenario could unfold, as some companies have already opted not to expand their presence in Vietnam. A recently leaked document by Vietnam’s investment ministry candidly noted that some top multinationals including Intel and LG Chem held off on billions of dollars in investments earmarked for Vietnam and chose to take their business elsewhere. Since coming to office, Mr. Lam and his team have spent considerable time reassuring leaders of key businesses that Vietnam’s geoeconomic goals and geopolitical direction will remain intact despite challenges. Their message is that Hanoi intends to keep businesses in priority technology fields, such as semiconductors and artificial intelligence, active in Vietnam. 

Least likely: Regime disruption

This scenario could emerge if fierce and prolonged party infighting begins to paralyze the ruling communist party. This prospect, though, seems remote for now. Although Mr. Lam’s tenure at the Ministry of Public Security, central to anti-corruption efforts, has divided opinion, it is unlikely that his detractors will resort to anything more disruptive than the usual political strategizing seen in recent Vietnamese politics.

However, if more destabilizing actions do occur, they could significantly undermine the legitimacy of the CPV, not just affecting investor confidence but also placing the country in uncharted territory. More prolonged but less severe regime disruption could also prove damaging. If Vietnam is unable to carry out the necessary economic reforms to escape the middle-income trap, inequality could worsen, increasing instability and jeopardizing the party’s hold on power.

By most estimates, escaping the middle-income trap will require unprecedented focus, including not just high growth and investment rates, but also ramping up a national innovation system and building out the tertiary education system. The recent downturn in neighboring China is a reminder to Vietnam’s officials that an impressive economic trajectory cannot be assumed to be linear forever. 

In his inaugural address after assuming the party’s chief role, Mr. Lam declared that: “With the Party’s correct and law-abiding policies … supported by the people’s trust and international friends, our Party will continue to grow and endure alongside the nation, intertwined with the people’s hearts.” 

At first glance, the statement seems optimistic, given the challenges facing both the country and the world at large. But a closer reading makes it clear that, in a single sentence, Mr. Lam is capturing the complex calibration that is required between the party, nation, people, and regional and international environment in order for Vietnam to continue to progress.