HANOI (AFP) - Vietnam's Parliament approved Mr Nguyen Xuan Phuc as the communist country's new prime minister on Thursday (April 7), handing him a five-year term and a range of tough challenges from domestic economic reforms to a simmering maritime dispute with China.

Phuc, a former deputy prime minister, was the only candidate nominated for the position by party officials earlier this year and won 90.26 per cent of the votes in the rubber stamp parliament, according to state-run VTV.

"I will do my best to serve the country and people," said the 61-year-old, whose election marks the completion of a five-yearly reshuffle of the Communist Party's top brass.

Mr Phuc takes over from former prime minister Nguyen Tan Dung, a charismatic leader who championed a reformist pro-business agenda and talked tough to Beijing over a territorial dispute in the contested South China Sea.

Mr Dung lost out in internal party elections in January, which analysts called a move back towards more consensus-based rule by the party's conservative wing.

"Dung was an individualist working within a conservative system of collective leadership. His demise is evidence that Vietnam is not yet ready for a modern, world savvy, prime minister," Vietnam expert Carl Thayer told AFP.

Vietnam is run by the Communist Party and officially led by a triumvirate of the party secretary general, president, and prime minister, with key decisions being made by the 19-member politburo.

Top communist leader Nguyen Phu Trong was reelected in January as party secretary general in a victory for the party's old guard.

On Saturday, the National Assembly approved top police general Tran Dai Quang as president - a key if largely ceremonial role.

New prime minister Phuc is "a competent technocrat" and will stick to the party line, Mr Thayer said.

"Phuc does not have the charisma of Dung. He will be a team player," he added.

Even senior party members greeted Phuc's election Thursday with a lukewarm reaction.

Communist Party veteran Tran Tuan Hung, 76, expressed concern over the financial troubles the new premier has inherited.

"How can he resolve public debt, budget deficits and corruption? I don't rely or expect much from him," he said.

Army General Nguyen Trong Vinh also told AFP the new leader was "nothing special" and that he did not expect much change under his watch.

In the past, the leadership handover was decided at the party congress in January but took up to six months to be confirmed by the National Assembly.

Analysts say the process has moved more quickly this year, partly because several top leaders are retiring from politics, and also because of an upcoming visit by US President Barack Obama in May.

"The new leadership is anxious to dismantle (former PM) Dung's network and gain prestige in the eyes of ordinary Vietnamese by meeting and greeting world leaders," Mr Thayer told AFP, adding that rising tensions with China has added to the urgency.

Well-known dissident Nguyen Thanh Giang, who spent time in jail for his criticism of the party in the 1990s, called Phuc's appointment a "step backwards" from Mr Dung.

"Phuc is not comparable in terms of competence, experience, international image. He has no international reputation and will need a lot of time to develop one," he told AFP.