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Subject

The latest developments in the South China Sea dispute between China and Vietnam.

Significance

Vietnam halted another promising offshore energy development in waters claimed by China in late March. The consortium developing the field, which includes Spanish oil company Repsol, is expected to lose up to 200 million dollars as a result.

Impacts

US shows of force in the South China Sea will not give Vietnam enough confidence to develop offshore resources.

The political relationship between Vietnam and China’s ruling parties will strengthen.

Vietnam will cooperate more with India and Japan.

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