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AMBASSADOR TALK

Long-term resilience

H.E. Julien Guerrier, Ambassador of the European Union (EU) to Vietnam, tells VET
about the promising economic relations between the two parties and the tools and
mechanisms the EU provides to support Vietnam’s future development.

% Under the EU-Vietnam Free Trade and digital and green transformation.
Agreement (EUVFTA), bilateral trade This world-class EU offer has enormous
has increased by 32 per cent, with Viet- potential for Vietnam by scaling up high-
nam’s exports to the EU being four-fold quality, sustainable investments to
higher that the EU’s exports to Vietnam. strengthen our bilateral partnerships and
What are the prospects for trade coop- position the EU as a prominent partner of
eration between the two in the years to Vietnam, boosting the competitiveness and
come and especially in 2024? security of global supply chains.
There are very bright prospects for eco- To leverage the Global Gateway funding,
nomic and commercial relations between Vietnam can focus on sustainable infra-
the EU and Vietnam. structure development, such as renewable
Trade, economic, and investment rela- energy projects, sustainable mobility, inte-
tions between the two have been built on grated urban planning, climate-wise plan-
a solid foundation. The EUVFTA has ning, and investment. This will not only
become an important aircraft lifting com- benefit the environment and climate change
mercial links between the two economies objectives but also contribute to the long-
to unprecedented heights. You have cor- the negative impacts of crises and term resilience of the Vietnamese economy.
rectly indicated the positive impact of the improved our trade relations. Furthermore, the funding mechanism
agreement on bilateral trade. In 2022, the Due to the very fast growth of our bilat- can contribute to sustainable growth in
EU’s exports to Vietnam rose 18 per cent, eral trade over the past years, we can expect Vietnam by encouraging the adoption of a
and Vietnam’s exports to the EU grew some deceleration in growth. We have low-carbon economy, with greener tech-
even more impressively, by 33 per cent, closely followed trade flows in 2023 and nologies, embracing nature-based solutions,
according to figures from Eurostat. Such have indeed noted a declining trend in the and sustainable practices. One of the key
growth represents the highest bilateral trade pattern. From January to September, priorities of the EU is sustainability, and it
export expansion between Vietnam and two-way trade shrunk by 7 per cent year- aims to invest in projects that adhere to
any trading partner during the year. on-year, to €43.7 billion ($48.22 billion), environmentally-sound principles. By part-
Bilateral trade has grown robustly since according to Eurostat. Vietnam’s exports nering with European companies, Vietnam
the implementation of the EUVFTA, only declined 6.8 per cent, to €35.3 billion can benefit from technology transfer, knowl-
falling insignificantly in 2020 under the ($38.95 billion), while EU exports fell 8.2 edge sharing, and access to new markets.
negative influence of the Covid-19 pan- per cent to €8.5 billion ($9.38 billion). This can attract FDI, stimulate innovation,
demic. To make a precise prediction about These figures signal some adjustment in and foster entrepreneurship in Vietnam,
trends in the years to come, it is important the trading pattern of the bilateral com- further contributing to its sustainable growth.
to have an insightful look into the trade mercial relationship in the context of a The European Fund for Sustainable
pattern of recent years. challenging global economic situation. I Development Plus (EFSD+) is the main
Before the implementation of the am of the opinion that such an adjustment financial tool to mobilize investments under
EUVFTA, the average annual growth of may continue in 2024 before stabilizing the Global Gateway. The tool consists of
Vietnam’s exports to the EU was 5-7 per and bouncing back strongly in 2025 and an innovative funding instrument that
cent, while that of the EU’s exports to the following years. helps generate investment through guar-
Vietnam was 3-5 per cent. With the excep- antee capacity and blending grants. The
tion of 2020, amid Covid, bilateral trade % How can Vietnam benefit from the EFSD+ is already quite active in Vietnam
ties have been growing strongly, in the EU’s Global Gateway funding mecha- in the areas of climate change adaptation
double-digits. In 2021, the EU’s exports nism to invest in infrastructure projects and energy transition. We are looking for-
to Vietnam expanded by 21 per cent, and establish economic relationships ward to further promoting investments,
while its imports from the country grew for sustainable growth? particularly in the acceleration to clean
12 per cent. This trend continued in 2022, The Global Gateway is the EU’s positive and renewable energy, connectivity, cli-
with EU exports rising 18 per cent and offer to our partner countries in support of mate-resiliency, and sustainable cities.
Vietnam’s exports 33 per cent. The past their own strategic autonomy. By scaling In addition to financial support, the
five years, from 2017-2022, which is two up high-quality geostrategic investments, EU’s Global Gateway funding mechanism
years before the implementation of the it aims to advance European interests and can also facilitate the establishment of eco-
EUVFTA and three years after enforce- position the EU and its 27 member states nomic relationships between Vietnam and
ment, have seen annual growth of 5 per more prominently in a geopolitically-con- other European countries. The EU is one
cent on EU exports and almost 11 per tested world by strengthening our bilateral of the largest economies in the world, and
cent for Vietnam’s exports, which is almost and regional partnerships. Under the Team its member states have a vast network of
double the normal average annual in the Europe approach, the Global Gateway aims business connections and trade links.
absence of an FTA. I intentionally provide to mobilize €300 billion ($331 billion) to
you with the data for this five-year period invest in sustainable growth in areas such % On December 1, 2023, at COP28, Viet-
to show how the EUVFTA has neutralized as transportation, education, research, health, nam officially announced its JETP

18 | VIETNAM ECONOMIC TIMES | MARCH 2024 en.vneconomy.vn