By Francesco Guarascio and Trevor Hunnicutt
HANOI/WASHINGTON (Reuters) - The United States and Vietnam are discussing the sale of Lockheed Martin (NYSE:LMT) C-130 Hercules military transport planes to Hanoi, two people familiar with the discussions said, in a sign of closer security cooperation between the two former foes.
The talks could lead to a supply agreement this year, the sources said, in what would represent Vietnam's largest military deal since it said publicly at the end of 2022 that it intended to diversify its defence supplies, which have for decades relied heavily on Russian gear.
The C-130 can carry soldiers, military equipment and other supplies, and would boost Vietnamese defence capabilities at a time of rising South China Sea boundary tensions with China and other countries in the region.
The United States could offer Hanoi financial support as part of a sale, the sources said. One of the sources, a U.S. official, said that could amount to tens of millions of dollars covering maintenance and other costs.
The other source, a Vietnamese person briefed on the talks, said the model under consideration was the C-130J, the aircraft's latest iteration.
Neither source would indicate the total cost of the possible deal and the number of planes under discussion. Both declined to be named because the talks were not public.
Lockheed Martin referred questions to the U.S. or Vietnamese governments. The White House declined to comment, and Vietnam's defence ministry did not respond to a request for comment.
Talks on U.S. arms supplies to Communist-ruled Vietnam have been under way for months, before major changes in Vietnamese leadership, which experts and analysts say should not significantly change the country's posture on foreign and economic affairs.
The discussions show the United States' growing efforts to gain influence with Hanoi, nearly half a century after the end of the Vietnam War.
Since an arms embargo was lifted in 2016, U.S. defence exports to Vietnam have been largely limited to coastguard ships and trainer aircraft, stymied by Hanoi's concerns over costs, U.S. government approvals and compatibility with existing gear.
FIGHTER JETS
Vietnam's police have looked into buying U.S.-made helicopters, and the defence ministry has considered different types of U.S. aircraft, including F-16 fighter jets, Reuters has reported.
The Vietnamese official confirmed the talks over F-16s, also produced by Lockheed Martin, but said those negotiations were less advanced because U.S. fighter jets were seen as more likely to affect Vietnam's relations with other countries, including China.
C-130s were "less sensitive", the official said, because they could be viewed as defensive or non-combat equipment.
U.S. congressional approval for the fighters may be more complicated than for C-130s, the Vietnamese official said, noting that Hanoi had also concerns about whether the U.S. would approve the sale of missiles to arm the F-16s.
U.S. State Department reports have laid out human rights violations in the Southeast Asian country, further complicating arms transfer approvals.