The chain reactions produced by the ending of the Cold War and the vast changes in the Soviet Union over the last few years are still working themselves through Asia. In Southeast Asia they are producing another turn of the geopolitical kaleidoscope.

The changes in Soviet policy, including the drastic reduction of aid to Vietnam, are forcing Hanoi to come to terms with China, its giant neighbour to the north with which, until recently, relations had been one of bitter enmity. And with Vietnam thus in dire straits and the Soviet threat to China much diminished, Beijing, for its part, sees this as an opportune time to strike a deal with Hanoi on important issues.

Events in Eastern Europe and the Soviet Union, too, are driving Vietnam and China closer. The elderly leaders of both states have watched the turmoil there with horror and seem determined to prevent at all costs its occurrence in their own countries. Both have agreed that while economic reform must continue, political pluralism cannot be permitted. Communist party rule must be preserved.

What will be the implications for Southeast Asia of a thaw in Sino-Vietnamese relations?

Firstly, there is likely to be a settlement of the Cambodian conflict where China and Vietnam have been the principal backers of the resistance and the Phnom Penh government, respectively. Both countries seem to have decided for their own reasons that it is time to settle the matter, though difficult negotiations may still lie ahead.

A final settlement will obviously have to be a compromise which is acceptable to both the Chinese and the Vietnamese. Beijing is committed to ensuring that the Khmer Rouge is not excluded but seems prepared to put pressure on it to go along with compromises worked out between the Sihanouk faction and Hun Sen. In the end, the Khmer Rouge may be increasingly marginalised.

Secondly, the chances of a conflict in the Spratlys will probably diminish because Vietnam and China were the two claimants most likely to have started one. The Spratlys issue will still pose dangers and it will be difficult to resolve in a manner acceptable to all parties because of the number of conflicting sovereignty claims, but the chances of it being contained will now improve.