Tensions between Hanoi and Beijing are high with a Chinese oil exploration ship and its coast guard escorts sailing in Vietnam's exclusive economic zone.
Mr Morrison met with Vietnamese Prime Minister Nguyen Xuan Phuc in Hanoi on Friday, with the leaders agreeing on a joint statement against the actions.
Australian Prime Minister Scott Morrison (left) his Vietnamese counterpart, Nguyen Xuan Phuc, shake hands during a press conference in Hanoi. Source: AAP
They called out disruptive activities in relation to long-standing oil and gas projects in the sea.
Australia and Vietnam called for international law to be followed despite China continuing to ignore a 2016 ruling against their actions in the South China Sea.
Mr Morrison said countries in the Indo-Pacific should be free to pursue their own interests free from coercion.
"It is about ensuring that each and every nation in the region can have confidence in its own independence and sovereignty," he told reporters.
But both leaders stopped short of explicitly naming China, continuing to call out the behaviour rather than the perpetrator.
"I am not here to make accusations or do anything of that nature. We do not take sides," he said.
Mr Morrison also wouldn't rule out an individual free trade agreement with Vietnam, hinting there could be movement on a deal in the future.
"I'm glad we came as friends and we leave as mates," he said.
The US has accused China of coercion and bullying over the incursions into Vietnamese territorial waters.
Mates and comrades
The visit was the first stand-alone bilateral visit to Vietnam by an Australian prime minister since Paul Keating in 1994.
The two countries upgraded their relationship to a “strategic partnership” in March last year.
Bilateral trade rose 19.4 per cent in 2018 to $7.72 billion, according to Vietnamese government customs data.
Australia is the largest foreign coal supplier to Vietnam, which is increasingly reliant on the fossil fuel for power generation to meet its fast-growing economy.
Coal shipments from Australia to Vietnam more than tripled in the January-July period from a year earlier to 8.51 million tonnes, according to customs data.
“Australia and Vietnam are friends and, today, to use Australian parlance, we’ve gone from friends to mates,” Morrison said.
Additional reporting: Reuters