Laos – Vietnam relations Laos – Vietnam relations refers to the current and historical relationship between Laos and Vietnam . Laotian relations with Vietnam had secretly set the strategy for the Lao People ' s Revolutionary Party ( LPRP ) during the struggle to achieve full power , and the " sudden " opportunity to establish the Lao People ' s Democratic Republic in 1975 left no leeway to consider foreign policy alignments other than a continuation of the " special relations " with Vietnam . The relationship cultivated in the revolutionary stage predisposed Laos to Indochinese solidarity in the reconstruction and " socialist construction " phases and all but ensured that relations or alignments with China and Thailand would be wary and potentially unfriendly . Further , the LPRP , unlike the Cambodia n communists under Pol Pot , was far too accustomed to accepting Vietnamese advice to consider striking out on its own . . . The final seizure of power by the hitherto secret LPRP in 1975 brought both a public acknowledgment of the previously hidden North Vietnamese guidance of the party and genuine expressions of gratitude by the LPRP to its Vietnamese partners . The challenge facing the ruling group — the construction of a socialist society — was seen as a natural extension of past collaboration with North Vietnam . The revolution was simply entering a new phase in 1975 , and the LPRP leaders congratulated themselves upon ousting the " imperialists " and looked forward to advice and economic as well as military support , which was not available from any neighbor or counter revolutionary state . LPRP leaders were accustomed to discussing policies as well as studying doctrine in Hanoi . They formalized governmental contacts with their mentors at biannual meetings of the foreign ministers of Cambodia , Laos , and Vietnam starting in 1980 and through the joint Vietnam - Laos Cooperative Commission , which met annually to review progress of various projects . Other levels of cooperation between Laos and Vietnam existed , for example , party - to - party meetings and province - to - province exchanges , as well as mass organizations for youths and women . Meetings of the commission were held regularly . The primary channels for Vietnam ' s influence in Laos , however , were the LPRP and the LPA . In the LPRP , long - standing collaboration and consultation at the very top made special committees unnecessary , whereas in the LPA , the Vietnamese advisers , instructors , and troops on station constituted a pervasive , inescapable influence , even though they scrupulously avoided public exposure by sticking to their designated base areas . Cooperation in the military field was probably the most extensive , with logistics , training , and communications largely supplied by Vietnam throughout the 1970s and 1980s ( heavy ordnance and aircraft were provided by the Soviet Union ) . The phrase " special relations " came into general use by both parties after 1976 , and in July 1977 , the signing of the twenty - five year Lao - Vietnamese Treaty of Friendship and Cooperation legitimized the stationing of Vietnamese army troops in Laos for its protection against hostile or counter revolutionary neighbors . Another element of cooperation involved hundreds of Vietnamese advisers who mentored their Laotian counterparts in virtually all the ministries in Vientiane . Hundreds of LPRP stalwarts and technicians studied in institutes of Marxism - Leninism or technical schools in Hanoi . The resources that Vietnam was able to bestow upon its revolutionary partner , however , were severely limited by the physical destruction of war and the deadening orthodoxy of its economic structures and policies . However , it could put in a good word for its Laotian apprentices with the Soviet Union , which in turn could recommend economic assistance projects to its East Europe an satellite states . Yet , Vietnam ' s influence on Laos was determined by economic assistance and ideology as well as by geographical and historical proximity . The two nations fit together , as the leaders liked to say , " like lips and teeth . " Vietnam provided landlocked Laos a route to the sea , and the mountainous region of eastern Laos provided Vietnam a forward strategic position for challenging Thai hegemony in the Mekong Valley . During the 1980s , Vietnam ' s regional opponents attributed to it a neo - colonial ambition to create an " Indochina Federation . " This phrase can be found in early pronouncements of the ICP in its struggle against the French colonial structures in Indochina . The charge , exaggerated as it was , lost its currency once Vietnam withdrew its troops from Cambodia in 1989 and subsequently from Laos . Laos ' s dependence on Vietnam since 1975 could then be perceived as a natural extension of their collaboration and solidarity in revolution rather than as domination by Vietnam . With the departure of Vietnamese military forces — except for some construction engineers — and the passing of most senior Vietnamese revolutionary partners , the magnetism of the special relationship lost its grip . Further , Vietnam was never able to muster large - scale economic aid programs . It launched only 200 assistance projects between 1975 and 1985 , whereas the Soviet Union generated considerably more in the way of contributions . In 1992 the long - standing Vietnamese ambassador to Laos , a veteran of fourteen years ' service , characterized the relationship as composed " d ' amitié et de coopération multiforme entre les pays " ( of friendship and diverse cooperation between the two countries ) . This pronouncement was far less compelling than the " objective law of existence and development " formulation sometimes expressed in the past . Although Vietnam ' s historical record of leadership in the revolution and its military power and proximity will not cease to exist , Laos struck out ahead of Vietnam with its New Economic Mechanism to introduce market mechanisms into its economy . In so doing , Laos has opened the door to rapprochement with Thailand and China at some expense to its special dependence on Vietnam . Laos might have reached the same point of normalization in following Vietnam ' s economic and diplomatic change , but by moving ahead resolutely and responding to Thai and Chinese gestures , Laos has broadened its range of donors , trading partners , and investors independent of Vietnam ' s attempts to accomplish the same goal . Thus , Vietnam remains in the shadows as a mentor and emergency ally , and the tutelage of Laos has shifted dramatically to development banks and international entrepreneurs . Bilateral relations and commerce . Since Laos passed the foreign investment promotion law in 1989 until 2012 , Vietnam has invested in total 429 projects with a combined value of US $ 4 . 9 billion , and currently the largest foreign investor in Laos . The two countries ' bilateral trade is about US $ 725 million at the end of 2012 .