Vietnam: Europe's Economic Anchor in Asia After Six Years of EVFTA

Six years after the Vietnam-EU Free Trade Agreement (EVFTA) took effect on August 1, 2020, Vietnam has become one of Europe's most important economic anchors in Asia, according to the European Chamber of Commerce (EuroCham). Bilateral trade between Vietnam and the EU has surpassed $900 billion since diplomatic relations were established in January 1995. Of this total, $383.8 billion, or 42.6%, has been generated since the EVFTA's implementation. In the first half of 2026 alone, bilateral trade reached $41.4 billion, with Vietnam enjoying a surplus of $22 billion, exceeding the entire year of 2019 ($21.7 billion) before the agreement officially came into force. The EVFTA has also boosted European business investment in Vietnam. EuroCham's Business Climate Index (BCI) for the second quarter of 2026 revealed that 55% of surveyed businesses consider Vietnam a core operational hub or a key growth market. Among businesses involved in import-export, half have directly benefited from the EVFTA, with 66% reporting specific financial savings, largely in the range of 5-15%. Bruno Jaspaert, Chairman of EuroCham, stated, "After six years, the impact of the EVFTA is evident and measurable. The agreement has reshaped trade flows, built business confidence, and made Vietnam one of Europe's most important economic anchors in Asia." Entering its seventh year, the EVFTA is progressing towards the EU officially completing its trade liberalization roadmap, eliminating tariffs for 99% of Vietnam's exports. Meanwhile, Vietnam is set to complete its tariff reduction process for EU goods by 2030. Jean-Jacques Bouflet, Vice Chairman of EuroCham and a former member of the EU's EVFTA negotiation team, believes that European high-tech products, advanced machinery, and pharmaceuticals are direct drivers for enhancing Vietnam's industrial productivity. Conversely, Vietnam's strengths in electronics, mechanics, textiles, footwear, wooden products, and agricultural goods perfectly complement and strengthen European supply chains, serving millions of European consumers. However, as tariff barriers gradually diminish, administrative complexities and compliance costs are emerging as significant bottlenecks, according to EuroCham. Among businesses facing challenges in leveraging the agreement, 50% cite domestic tax management, complex tax processing, and delayed VAT refund mechanisms as core obstacles. Another 33% mention the complexity of Rules of Origin (RoO), Certificate of Origin (C/O) procedures, and varying verification requirements across jurisdictions. 17% find compliance costs too high compared to the marginal tax savings achievable. EuroCham quotes a multinational manufacturing company stating that less than 20% of shipments to the EU currently qualify for EVFTA preferences due to differing interpretations of documentation between EU member states and Vietnam, and constantly changing origin requirements that make sustained compliance difficult. Therefore, maintaining Vietnam's export advantage will increasingly depend on simplifying customs procedures, accelerating tax refunds, digitizing documentation, and clarifying rules of origin, EuroCham emphasizes.