HANOI - US President Barack Obama on Monday scrapped a Cold War-era ban on weapons sales to Vietnam, as ties between the former foes grow closer thanks to trade and mutual fears of Chinese expansion in disputed seas.
The announcement, made at the start of Obama's three-day visit to Vietnam, ends a decades-old embargo and will likely infuriate Beijing, which has been increasingly assertive in its claims to disputed areas of the South China Sea.
"The United States is fully lifting the ban on the sale of military equipment to Vietnam that has been in place for some fifty years," Obama said at a joint press conference alongside his Vietnamese counterpart President Tran Dai Quang.
Obama said the move was not prompted by China's regional manoeuvres, but came as the countries enter a "new moment" that takes them towards a "normalisation" of ties.
Vietnam's Quang welcomed the rollback of the ban, hailing the shared "common concerns and interests" that now bind the two countries.
The Obama administration has pitched this week's trip as an opportunity to push ties beyond the period of rapprochement, with Vietnam now a vital plank in America's much vaunted pivot to the Asia-Pacific region.
The visit is Obama's first - and the third by a sitting president since the end of the Vietnam War in 1975. Direct US involvement in the conflict ended in 1973.
The nations have experienced an astonishing turnaround in their relations, from bitter foes physically and psychologically scarred by a decade of war to regional allies.
Obama said he was "moved" to see thousands of locals lining Hanoi's streets, craning with smartphones in hand for a view of his motorcade.
Washington and Hanoi share common security goals as Beijing flexes its muscles in the South China Sea, where Vietnam and several other nations also claim ownership of islands and reefs.
But historically Vietnam's dismal human rights record has weighed against a full rollback of the arms embargo.
In a muted reference to its parlous rights situation, Obama said Washington "still had differences" with Vietnam on human rights but "modest progress" had been made.
The sentiment will jar with many long-persecuted activists and dissidents.
The one-party state still ruthlessly cracks down on protests, jails dissidents, bans trade unions and controls local media.
Trade also dominated much of the first day of the unusually long trip.
A series of deals were unveiled worth some US$16 billion (S$22 billion), including an agreement for VietJet, Vietnam's privately-owned budget airline, to spend US$11.3 billion on Boeing passenger jets.
Both nations have long pushed for closer trade ties, with the US hoping to tap into the growing wealth of Vietnam's burgeoning middle-classes.
Hanoi's leaders meanwhile crave continued growth to deflect opposition to their authoritarian rule.
Obama said he was confident Congress would ratify the 12-nation Trans-Pacific Partnership trade deal which includes Vietnam.
Quang said the pact can "be a driver of economic growth in (the) Asia-Pacific region", adding Vietnam "is committed to fully implementing" all of its clauses, which include recognition of workers' rights.
The visit comes at a time when America has rarely, if ever, been so popular among ordinary Vietnamese.
A poll last year by the Pew Research Centre found 78 per cent of Vietnamese have a favourable view of the United States, the third highest in Asia after the Philippines and South Korea.
The approval rate was even higher among young people in a nation where the median age is around 29.
"I like Obama as he seems moderate," Nguyen Toan Thang, an office worker, told AFP. "This is a once in a lifetime chance to see the US president coming to Vietnam." Like most Vietnamese, 25-year-old Doan Quang Vinh from Hanoi was born long after the war.
"For me, the American war against Vietnam is a matter of the past, and though we must not forget the past, we should not dwell on it. We should look towards the future," he told AFP.
Later Monday Obama will hold talks with Prime Minister Nguyen Xuan Phuc.
But the most important meeting will be afterwards with de facto leader Nguyen Phu Trong, the general secretary of the Communist Party.
Trong and Obama met last July, when he was given a prestigious Oval Office meeting.
On Tuesday afternoon Obama will fly to Ho Chi Minh City, the southern city formerly known as Saigon and the country's thriving commercial heart, four decades after American troops beat a hasty retreat.
There he will meet tech entrepreneurs and hold one of his trademark town hall gatherings with young people.