Political & economic relations
The diplomatic ties between EU and Vietnam were established in October 1990 after which Vietnam has become one of EU's main partners in Southeast Asia. A very broad spectrum of cooperation between the EU and Vietnam ranges from political issues and global challenges to trade and development. The EU's diplomatic representation in Hanoi was established in 1996.
In its relations with Vietnam, the EU aims at:
- supporting the sustainable economic development of Vietnam and the improvement of living conditions of the poor;
- encouraging the integration of Vietnam in the world economy and trading system and supporting the process of economic and social reforms;
- supporting Vietnam's transition to an open society based on sound governance, rule of law and respect for human rights;
- raising the profile of the European Union in Vietnam.
One of the first important milestones in bilateral relations was the signing of an EU-Vietnam Framework Cooperation Agreement (FCA) in 1995 and its entry into force on 1 June 1996. The FCA defined the terms of relations, broadening them beyond the humanitarian dimension of their early years. It specified four main objectives: i) to secure the conditions and promote the development of bilateral trade and investment, ii) to support the sustainable economic development of Vietnam, iii) to enhance economic cooperation, including support to Vietnam’s efforts to move towards a market economy, and iv) to support environmental protection and the sustainable management of natural resources.
In 2012, EU-Vietnam Framework Agreement on Comprehensive Partnership and Cooperation (PCA) was signed, demonstrating the commitment of the EU to forge a modern, broad-based and mutually-beneficial partnership with Vietnam. The European Parliament ratified the PCA in December 2015. The PCA broadens further the scope of EU-Vietnam cooperation in areas such as trade, the environment, energy, science and technology, good governance, as well as tourism, culture, migration, and the fight against corruption and organised crime. The PCA brings on board the EU and all its Member States, therefore providing opportunities for increased coherence and synergies between the policies of the EU and of its Member States. The EU and the Vietnamese government have identified some priorities in the PCA that are subject to advanced application.
Under the PCA, a Joint Committee composed of representatives of both sides is to be established for high-level discussions on political and economic developments in the EU and Vietnam, including the continued progress of Vietnam's economic, administrative, legal and judicial reforms as well as the implementation of EU cooperation programs.
With the aim of developing a strong and dynamic partnership, the EU and Vietnam have agreed to fast-track the implementation of some of the key aspects of the PCA, annually hold the EU-Vietnam Human Rights Dialogue as well as EU-Vietnam Political Consultations at Vice-Ministerial level.
The EU is looking forward to the realisation of the potential of the trade and investment principles established in the PCA through a EU-Vietnam Free Trade Agreement (FTA), which will bring two-way trade and investment to new levels. The FTA negotiations, which started in 2012, were completed in 2015. The FTA is expected to enter into force in 2018.
Another fundamental part of EU's engagement with Vietnam is development cooperation. In fact, the EU together with its Member States is currently the largest grant donor in Vietnam. The EU has announced an indicative amount of €400 Million for development cooperation for the period of 2014-2020 with a focus on good governance and energy, including climate change.