The free trade agreement between Vietnam and the European Free Trade Association (EFTA) opens up new opportunities for scientific and technological cooperation, high-quality investment and innovation, in line with Vietnam’s development priorities under Politburo Resolution No. 57-NQ/TW.

The Vietnam – EFTA Free Trade Agreement (VEFTA) was officially signed on October 18, 2026, marking a new step in the country’s international economic integration and creating prospects for deeper cooperation in science, technology and innovation.

The agreement comes as Vietnam accelerates the implementation of Resolution No. 57-NQ/TW, dated December 22, 2024, which identifies breakthroughs in science and technology, innovation and national digital transformation as key drivers of development.

The EFTA comprises Switzerland, Norway, Iceland and Liechtenstein. Although relatively small in population, these economies have strong capabilities in technology, finance, research and development (R&D), particularly in knowledge-intensive industries.

Switzerland is known for pharmaceuticals, biotechnology and precision engineering; Norway for maritime technology, clean energy and aquaculture; Iceland for geothermal technology and seafood processing; and Liechtenstein for specialised manufacturing. These strengths complement Vietnam’s development needs, particularly in high-tech industries, supporting industries, energy, the marine economy and advanced processing.

According to Vice President of the Foreign Trade University Associate Professor Dr. Dao Ngoc Tien, the VEFTA’s long-term value lies largely in its non-tariff commitments, which establish institutional frameworks, principles and cooperation mechanisms with lasting economic impacts.

The agreement includes commitments on investment, intellectual property, cooperation and capacity building. Stronger intellectual property protection could encourage Swiss and Norwegian businesses to invest and transfer technology, while helping Vietnamese companies protect their inventions and trademarks and develop their brands.

Its cooperation and capacity-building provisions also provide a framework for technical assistance, allowing Vietnam to propose joint programmes on standards, technical regulations and intellectual property. These areas are important for research, technology application and commercialisation.

Meanwhile, tariff reductions on machinery, equipment, chemicals and materials imported from the EFTA could help Vietnamese businesses access high-quality production inputs and technology at more favourable costs. However, the benefits would be greater if equipment purchases were accompanied by workforce training, process improvements and efforts to master the technologies involved.

As of the end of 2025, Switzerland had 234 investment projects in Vietnam with registered capital exceeding 2.4 billion USD, while Norway had 62 projects worth more than 201 million USD. These investments provide a foundation for broader cooperation, particularly in technology-intensive sectors.

Economist Ngo Tri Long said the VEFTA’s strategic benefits should be assessed not only through trade growth but also through its ability to attract high-quality capital, technology and management expertise. Investment performance should be measured by technology transfer, the development of domestic suppliers and technical workforce training, rather than registered capital alone.

This approach would help Vietnamese businesses move into higher-value activities, strengthen their technological capabilities and improve their competitiveness in global value chains.

These opportunities align with Resolution 57 which sets a target for R&D spending to reach 2% of gross domestic product (GDP) by 2030, for more than 40% of businesses to engage in innovation activities, and for high-tech products to account for at least 50% of total export value.

Achieving these goals requires domestic resources as well as international partnerships, access to advanced technologies and a stronger innovation ecosystem. Resolution 57 also calls for greater scientific research and technology development cooperation with countries that have advanced technological capabilities, alongside capacity building and technology transfer through international agreements.

In this context, the VEFTA could provide an additional channel for Vietnam to access technological resources from developed economies. However, the agreement creates favourable conditions rather than guaranteeing automatic technology transfers.

Vietnam therefore needs to proactively promote joint R&D programmes, connect businesses with research institutes and universities in EFTA countries, and encourage joint ventures, production partnerships and technology applications in sectors with strong domestic demand and development potential.

Priority should also be given to investment projects that conduct R&D in Vietnam, train highly skilled workers, develop supporting industries and transfer knowledge to domestic businesses.

Nguyen Minh Khoi of the Tony Blair Institute for Global Change said the VEFTA’s long-term effectiveness should be measured not only by trade turnover but also by high-quality investment projects linked to innovation, participation in global value chains and the ability to retain added value in Vietnam.

Another priority is to strengthen Vietnamese businesses’ capacity to absorb and develop technology. Acquiring modern machinery is only the first step; the ability to operate, improve and develop technology into new products and services ultimately determines the effectiveness of innovation./.VNA