CHINA and Vietnam will formally normalize relations today, ending more than a decade of hostility and border skirmishes between the Asian communist rivals.Vietnamese Communist Party chief Do Muoi and Prime Minister Vo Van Kiet are scheduled to arrive in Beijing today for a five-day visit. Mr. Muoi is the highest-ranking Vietnamese leader to visit China since 1977. After a red-carpet welcome this afternoon, Muoi and Mr. Kiet will hold talks with Chinese Communist Party chief Jiang Zemin and Premier Li Peng. "Vietnam and China went through 10 years of twists and turns," says a Vietnamese diplomat in Beijing. "This normalization will bring a lot of benefits for our people, economic cooperation, and promote security in the region," he says. Yet obstacles to improved relations remain, bolstered by centuries of mistrust between China and its former client state. This week's talks are expected to cover sensitive topics such as the territorial disputes between China and Vietnam over border lands and the Spratly and Paracel islands in the South China Sea, the diplomat says. The signing of the peace agreement on Cambodia last month paved the way for a breakthrough in Sino-Vietnamese relations. Beijing and Hanoi have supported opposite sides in Cambodia since 1978, when Vietnam invaded Cambodia and ousted the Chinese-backed Khmer Rouge regime. In 1979, China invaded Vietnam in retaliation and the two countries fought a month-long border war. But skirmishes along the border continued inflicting casualties until the late 1980s. The rapprochement was also hastened by the breakup of the Soviet bloc and Moscow's abandonment of communism. Beijing and Hanoi have drawn closer ideologically as their Marxist leaders vow to uphold communism and fight against inroads by democratic movements. More pragmatically, Beijing may seek to fill a geopolitical void in Indochina created by the decline of the Soviet empire. Hanoi, meanwhile, hopes economic ties with China will help compensate Vietnam for the Soviet withdrawal of aid and preferential trade terms last year. During the current visit, Beijing and Hanoi are expected to conclude an accord on economic cooperation, telecommunications, and establishing air and rail links. China announced last month that it has begun rebuilding railroad tracks destroyed during the border war, and hopes to link them with those on the Vietnamese side in two months. Trade between China and Vietnam has soared in recent years, reaching $20 million in the first half of this year compared with $2.7 million for all of 1988, according to Vietnamese figures. Those figures do not include border trade, which according to Chinese reports has totaled $100 million or more over the past three years. To expand trade, China in August proposed opening part of its 600-mile border in Guangxi Province with Vietnam.