Some analysts see Southeast Asia dividing into continental and maritime sub-groups, largely due to great power rivalry. This paper seeks to address the implications of this division for Vietnam. Sustaining positive bilateral relations with China has been challenging for Vietnam because of the asymmetry of power between the two neighbours. Relations with Beijing have a determining effect on Vietnam's foreign policy, ties with other regional actors and its position in the Southeast Asian divide. Improved ties with the U.S. provide Vietnam a counterbalance against China. Despite good prospects for Hanoi-Washington relations, the sensitive issues of human rights and democratisation remain obstacles.