Vietnam will likely ratify a U.N. convention on labor rights to appease Western trade partners, but the government will probably only partially enforce the convention, mitigating its impact on businesses operating in the country. According to U.N. officials and a Hanoi-based diplomat cited in a Feb. 27 Reuters report, Vietnam is expected to ratify the U.N. convention on the free establishment of trade unions later this year, likely in October. The United Nations' Freedom of Association and Protection of the Right to Organize Convention, known commonly as Convention 87, was created in 1948 and stands as a global safeguard for labor rights. However, it remains unclear as to how, once ratified, the convention would be applied in Vietnam, where labor organizations are tightly controlled, and where the only existing and legal trade union — the Vietnam General Confederation of Labor — is an organ of the Vietnamese Communist Party, which rules over the country in every facet. 

• Vietnam joined the International Labor Organization, the U.N. agency tasked with setting international labor standards, in 1993. But Convention 87 is one of several requirements for membership that Vietnam has yet to ratify. The Southeast Asian country has been discussing ratification of the convention since 2014.

Pressure from trade partners like Canada and the European Union is likely what's driving Vietnam to finally ratify the convention after years of discussion. Vietnam's substandard labor practices risk heightening tensions with Canada and the European Union, which together comprise about 11% of Vietnam's total import-export turnover. This is because Hanoi's trade agreements with both Ottawa and Brussels each stipulate worker protections, including the right to organize. Canada, in particular, is currently reviewing Vietnam's labor standards to determine if they are in line with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), of which both countries are members. Hanoi also promised Ottawa that it would ratify Convention 87 by January 2024 — a deadline it has since missed. The passing of that deadline could provide Canada with a justification to bring Vietnam in front of the CPTPP's dispute resolution panel, which could result in sanctions and penalties on Vietnam. The European Union, for its part, has also criticized Vietnam's labor rights standards in the context of the EU-Vietnam Free Trade Agreement, which came into force in 2019. 

• Together, Canada and the European Union account for $75 billion in annual trade in Vietnam's export- and commerce-dependent economy. For Hanoi, maintaining and expanding its trade relations with Ottawa and Brussels is thus a top priority.
• Western governments' insistence that Vietnam ratify Convention 87 has less to do with wanting to improve working conditions in the country, and more to do with wanting to reduce Vietnam's ability to unfairly compete for global business by intentionally suppressing wages, which lowers labor costs and enhances a country's attractiveness as a foreign investment destination — a process commonly known as ''social dumping.''

The full implementation of Convention 87 would increase labor costs in Vietnam, but the actual implementation will likely come well short of the spirit of the convention, thus mitigating the extra costs to foreign companies. While Vietnam will likely ratify Convention 87 amid pressure from its trade partners, it will also find workarounds to preempt genuine labor union formation, which will limit the potential damage to Vietnam's attractiveness as a foreign investment destination. This is because Vietnam will remain reluctant to allow grassroots organizations or uncontrolled sectors of civil society to proliferate, which the government considers a threat to its monopoly on power. Indeed, single-party Vietnam maintains tight societal control of independent organizations in all realms of civic life, including religious organizations, educational institutions, non-governmental organizations, climate activist groups and labor — and this will not dissipate as a result of criticism from foreign governments, or the ratification of U.N. conventions. As long as Vietnam acquiesces to international standards on paper, its value as an emerging manufacturing hub near China with low labor costs will grow, as will its broader geopolitical strategic value for Western countries amid their escalating rivalries with China. Even if Western trade partners need to see actual progress to back off, the government can apply other means to assuage them, such as making a show of increasing workplace safety standards or cracking down on companies that blatantly abuse employees.
Thus, the actual application of Vietnam's commitments under Convention 87 will most likely be shortchanged, reducing the impact on employers — and workers — in the country. 

• In 2022, Vietnam signed the Just Energy Transition Partnership with G-7 countries, which will provide Vietnam with $15.5 billion in funding to assist its green energy transition. Vietnam's imprisonment of organized and high-profile climate activists was a sticking point in negotiations, but the G-7 ultimately acquiesced despite the activists remaining behind bars, all of whom were dubiously charged for tax evasion. Vietnam arrested another climate activist since the G-7 agreement was inked, and faced no consequences for doing so. This provides an example of Vietnam making a show of adhering to commitments without actually following through on those commitments, and Western interlocutors doing little on their end to similarly shape Vietnamese policy.
• An internal memo distributed within the South Korean consumer electronics giant Samsung bemoaned the possibility of unionization in Vietnam, citing the ''disorderly proliferation of unions'' and deterioration of industrial relations. The memo highlighted that foreign governments, not foreign companies, are the ones keen on Vietnam ratifying Convention 87.
• While still comparatively low, labor costs in Vietnam have been slowly increasing. A 6% increase in minimum wages is set to be applied in July, but this increase is a controlled calculation by the Vietnamese government as a byproduct of economic growth and development, making it more predictable than union-driven wage hikes.
• According to media reports published on March 1, Vietnam circulated an unverified decree over the summer that allegedly aims to increase the government's control over many aspects of civil society in the country, including labor activism and union activity, as well as foreign firms' roles in the local economy. The so-called Directive 24 decree was reportedly circulated in July 2023 — mere weeks before Vietnam upgraded its ties with the United States.