Switzerland, Norway and other members of the European Free Trade Association (EFTA) are preparing to sign a free trade agreement with Vietnam on Sunday, October 18, marking a significant step towards expanding economic ties between Europe and Southeast Asia.
The agreement follows the conclusion of negotiations earlier this year and comes as countries seek to diversify export markets amid uncertainty over global tariffs and trade policies. Reuters reported on October 14 that EFTA and Vietnam are set to sign the deal this weekend.
What Is the EFTA–Vietnam Trade Agreement?
EFTA is a group of four countries: Switzerland, Norway, Iceland and Liechtenstein. Although its members are not part of the European Union, they cooperate on trade and economic matters.
The proposed agreement is designed to reduce trade barriers and establish clearer rules for businesses operating between the EFTA countries and Vietnam. Its coverage includes trade in goods and services, investment, intellectual property, government procurement, competition and sustainable development.
Negotiations began in 2012 but stalled in 2018. Talks resumed in September 2025 and were concluded in July 2026 after further rounds of negotiations.
Tariff Cuts Could Expand Market Access
Vietnam’s government has said the agreement is expected to improve access for Vietnamese products in EFTA markets, where consumers have substantial purchasing power.
According to Vietnam’s government news portal, EFTA has committed to immediately liberalising more than 90% of its tariff lines, covering 99.5% of Vietnam’s exports to the bloc. The agreement also provides for immediate tariff elimination on industrial products, including seafood.
Vietnam, in turn, has offered to eliminate tariffs on more than 86% of its tariff lines, equivalent to 99.9% of imports from EFTA, either immediately or through phased reductions over three to 15 years.
The precise benefits for individual products will depend on the agreement’s tariff schedules and implementation arrangements.
Which Industries Could Benefit?
Vietnamese exports that could benefit include textiles and garments, footwear, seafood, computers, electronic components, machinery and equipment.
EFTA businesses, meanwhile, export products such as electrical and mechanical machinery, pharmaceuticals, fish products and other specialised goods to Vietnam.
The agreement could also create opportunities for investment and cooperation in technology, clean energy, manufacturing and innovation. However, the scale of any additional trade or investment will depend on business demand and how effectively companies use the new market-access provisions.
Trade Between EFTA and Vietnam
Trade between EFTA and Vietnam has expanded over the past decade. EFTA reported that bilateral trade reached approximately €4.8 billion in 2025, with Vietnam recording a trade surplus of about €2.5 billion. The Swiss figures used in that comparison exclude gold trade.
The new agreement is intended to provide businesses with more predictable trading conditions and help both sides broaden their commercial relationships.
For Vietnam, access to EFTA markets could support efforts to diversify exports. For Switzerland, Norway and the other EFTA members, the deal could improve access to a growing Asian economy and create additional opportunities for exporters and investors.
What Happens After Signing?
Signing the agreement would be an important milestone, but it would not necessarily mean that all provisions take effect immediately. The agreement will need to follow the relevant domestic approval and implementation procedures before entering into force.
The timing of implementation, including when individual tariff reductions begin, will therefore be important for businesses planning exports and investment.
The bottom line: The EFTA–Vietnam agreement aims to reduce trade barriers, expand market access and strengthen economic cooperation between four European countries and Vietnam. Its practical impact will become clearer once the agreement is signed and its implementation timetable is confirmed.
