(TBTCO) – In just five years since it officially came into effect, the European Union - Vietnam Free Trade Agreement (EVFTA) has catalyzed a strong surge in bilateral trade turnover, accumulating nearly USD 300 billion. Amid rising geopolitical tensions and increasingly fragmented global supply chains, the EVFTA has emerged as a model of cooperation based on rules, shared values, and a long-term development vision.
Bilateral trade turnover reaches USD 298 billion
Signed on June 30, 2019, and officially effective from August 1, 2020, the EVFTA is one of the most comprehensive and ambitious free trade agreements ever concluded by the EU with a developing country. The agreement eliminated over 70% of tariffs on numerous import and export goods between the two parties. The remaining tariffs—up to 99%—will be gradually removed according to a scheduled roadmap in the coming years.
Beyond tariff reductions, the EVFTA has expanded market access, strengthened intellectual property protection, and promoted transparency in regulatory systems—all aimed at creating more favorable conditions for businesses from both sides to maximize trade opportunities.
Textile and garment products are among Vietnam’s key export items to Europe.
In reality, since its implementation, the EVFTA has significantly contributed to the strong growth of EU–Vietnam trade. According to preliminary data from the General Statistics Office (Ministry of Finance), in less than five years (from August 2020 to May 2025), bilateral trade turnover has reached USD 298 billion. This figure accounts for nearly 40% of the total accumulated trade volume between the two sides (USD 815 billion) over more than 30 years of trade cooperation since 1995 — a clear testament to EVFTA’s catalytic role in expanding market access and deepening bilateral economic relations.
According to the World Trade Organization (WTO), there are currently 328 free trade agreements (FTAs) in effect worldwide — a significant increase from just 98 in the year 2000. Among them, Vietnam has signed 17 FTAs, affirming its central role in both regional and global trade networks.
Currently, Vietnam is the EU’s largest trading partner in goods within ASEAN and ranks 16th globally. Vietnam’s exports to Europe are diverse, ranging from electronics, textiles, and furniture to agricultural products.
Conversely, the EU is Vietnam’s third-largest export market and fourth-largest import source, supplying strategic products such as high-tech machinery, transport equipment, pharmaceuticals, and green technologies.
Bruno Jaspaert, Chairman of the European Chamber of Commerce in Vietnam (EuroCham), noted that beyond its direct economic impact, the EVFTA also serves as a catalyst for long-term alignment in values and standards between Vietnam and the EU.
“In a time when the world is scrutinizing every detail of new trade agreements and hesitating in the face of reciprocal tariff policies from the U.S., the EVFTA brings rare clarity and stability. Its transparent terms and mutual commitments show that harmonized standards and open markets are the path to sustainable growth and long-term prosperity,” Jaspaert emphasized.
A wealth of opportunities ahead
EuroCham’s latest Business Confidence Index (BCI), released in Q2/2025, reveals that the EVFTA is increasingly proving its effectiveness. Up to 66% of surveyed companies are actively engaging in trade between the EU and Vietnam, and nearly all (98.2%) have at least some level of understanding of the agreement. Half of the businesses reported benefits ranging from moderate to significant — a figure expected to rise as tariff reduction commitments are fully implemented in the coming years.
Notably, it's not just large corporations benefiting; small and medium-sized enterprises (SMEs) are also making the most of the agreement's incentives. The percentage of companies viewing tariff reductions as a key advantage surged from 29% in Q2/2024 to 61% in the same period this year. Some businesses have been able to quantify direct profits from the EVFTA, with an average increase in net profit of 8.7%, and some reporting impressive gains of up to 25%.
Vietnam is gradually becoming a strategic ecosystem for European businesses to integrate more deeply into emerging global supply chains.
According to EuroCham, beyond tariff preferences, the EU-Vietnam Free Trade Agreement (EVFTA) also serves as a key instrument for European businesses to gain better access to Vietnam’s rapidly growing domestic market — from enjoying preferential policies in foreign direct investment (FDI) to participating in public-private partnership (PPP) projects.
With a population of 100 million and a labor force of over 55 million, Vietnam is gradually becoming a strategic ecosystem for European businesses to integrate more deeply into new supply chains and expand their long-term market presence.
On the other hand, with a total GDP of USD 29 trillion (in purchasing power parity) and over 450 million consumers, the EU is currently the world’s largest unified economic bloc. This offers ideal conditions for high-quality Vietnamese products — from agricultural goods and processed foods to consumer goods and technology — to win the favor of European consumers. The EVFTA is helping Vietnam position itself as a reliable manufacturing and export hub amid increasingly fragmented global supply chains.
EU Ambassador to Vietnam, Julien Guerrier, emphasized: “After five years, the EVFTA has proven to be an effective cooperation framework. It has strengthened trust, boosted trade, and delivered tangible benefits to both sides. In a time of ongoing volatility in global trade, the enduring partnership between the EU and Vietnam is more crucial than ever. The EU remains committed to accompanying Vietnam on its journey toward a greener, more sustainable, and prosperous future.”
The focus of Vietnam–EU bilateral cooperation is now shifting toward strengthening and deepening the strategic partnership. The EU–Vietnam Investment Protection Agreement (EVIPA) is currently awaiting ratification by some EU member states. Once in effect, EVIPA will establish a robust legal framework to safeguard and promote high-quality, long-term investment flows from Europe into Vietnam.
