The EVFTA has changed the face of trade between Vietnam and the European Union. In this article, the Vietnam Briefing considers the specifics of what this has meant for trade between EU member Sweden and Vietnam.
Last year, on the sidelines of the 28th UN Climate Change Conference (COP28) in the United Arab Emirates, Vietnamese Prime Minister Pham Minh Chinh met with the Prime Minister of Sweden Ulf Kristersson. This was just one more in a long list of high-level meetings between Vietnam’s leadership and that of a European Union member state.
Indeed, interest in Vietnam from the EU has grown rapidly since the EU-Vietnam Free Trade Agreement (EVFTA) came into action in 2020. This interest has denoted a rise in trade between the bloc and Vietnam that looks set to grow even more moving forward.
In this light, in this article, we look in detail at exactly what it has meant for trade between Sweden and Vietnam.
Trade rules and regulations between Sweden and Vietnam
EU-Vietnam Free Trade Agreement (EVFTA)
The EVFTA is an ambitious pact set to eliminate almost 99 percent of customs duties between the EU and Vietnam. This agreement is expected to increase Vietnam’s GDP by 4.6 percent and its exports to the EU by 42.7 percent by 2025, according to the Ministry of Planning and Investment (MPI). The European Commission also forecast the EU’s GDP to increase by US$29.5 billion as a result of the agreement.
EU-Vietnam Investment Protection Agreement (EVIPA)
Currently in the works is the EVIPA. This agreement would help to protect European enterprises investing in Vietnam and vice-versa. Currently, the agreement still needs to be ratified by a number of European nations.
Sweden’s exports to Vietnam
Sweden’s biggest exports to Vietnam in 2023 were machines, equipment, tools, and instruments; pharmaceutical products; and paper. Collectively these three items accounted for US$218.66 million of Sweden’s exports to Vietnam out of a total US$342 million.
Vietnam’s exports to Sweden
Vietnam’s exports to Sweden far outweigh its imports from Sweden. This is in large part due to Vietnam’s emerging role as a manufacturing powerhouse. Specifically, telephones, mobile phones and parts thereof; machines, equipment, tools, and instruments; and textiles and garments made up the bulk of Vietnam’s exports to Sweden. These three items account for US$578.13 million out of a total of US$946.15 million worth of exports to Sweden from Vietnam.
Vietnam-Sweden trade moving forward
Trade between Vietnam and the European Union in the wake of the passage of the EVFTA has flourished and this is evident in trade between Sweden and Vietnam.
Moving forward, as the EVFTA continues to see tariffs come down on a range of products, trade between these two nations should become even stronger. This may be further fortified by the EVIPA once ratified by the EU’s member states.
Overall, Vietnam and Sweden have become important trading partners and this should continue long into the foreseeable future.
Source: Vietnam Briefing
