Vietnam has signed a free-trade agreement with four European countries, establishing a framework to expand commercial ties and reduce trade barriers between the Southeast Asian economy and members of the European Free Trade Association (EFTA).
The agreement was signed in Hanoi on Sunday by Vietnam and the EFTA members Norway, Switzerland, Iceland and Liechtenstein, according to announcements by the Norwegian and Vietnamese governments.
The deal will progressively reduce tariffs on Norwegian exports to Vietnam. Around half of Norway’s exports to the country will be tariff-free when the agreement enters into force, with more than 98 per cent expected to qualify for duty-free access within seven years, the Norwegian government said.
The agreement follows years of negotiations that had remained stalled before being relaunched last year amid growing global tensions over US tariffs. Negotiations concluded in July, paving the way for the formal signing.
The agreement is intended to strengthen commercial relations between Vietnam and the four European countries by improving market access for goods traded between them. Its implementation is expected to provide exporters with a more favourable framework for reaching markets across the two regions.
Vietnam’s trade ministry said the country’s principal exports to EFTA markets include seafood, footwear, textiles, machinery and equipment, electronics and electronic components. Its imports from the four countries mainly comprise industrial machinery and equipment, chemicals, pharmaceuticals and raw materials used in production.
These trade flows reflect the complementary nature of commercial exchanges between Vietnam and the EFTA economies, with Vietnamese exports spanning manufactured goods and consumer products, while imports include industrial inputs and equipment.
Bilateral trade between Vietnam and EFTA member countries has averaged US$2 billion annually, according to Vietnam’s trade ministry. The agreement is intended to provide a basis for expanding those exchanges by reducing trade barriers and improving access to markets.
The tariff reductions outlined by Norway represent a significant element of the deal for Norwegian exporters, although the precise effects across individual industries will depend on the agreement’s implementation and the timetable for removing duties.
The signing also follows the resumption of negotiations last year, when uncertainty surrounding international trade and US tariff policies formed part of the wider context for renewed efforts to conclude the agreement.
With negotiations completed in July and the agreement now signed, Vietnam and the four EFTA countries have established a new framework for their trade relationship. The agreement’s entry into force will determine when the tariff reductions begin to apply and when exporters can start benefiting from the new arrangements.
