Particularly in 2022, the value of Vietnamese goods exported to Sweden reached 1.264 billion USD, up 5.4% year-on-year and imports reached 353 million USD, up 9.9% year-on-year. Total import and export turnover reached 1.617 billion USD, up 6.3% compared to 2021. Vietnam's main exports to Sweden are phones of all kinds, computers, electronic products and components, textiles, footwear, iron and steel products, spare parts, etc.

Vietnam's main imports from Sweden are telecommunications equipment, machinery and equipment of all kinds, and pharmaceuticals. Vietnamese rice products were previously almost absent in Sweden because they could not compete with rice from Cambodia and Thailand, now the turnover has increased to more than 3 million USD and is continuing to increase market share.

2023 has been a difficult year for the world economy due to the prolonged impact of many major fluctuations, such as the Russia-Ukraine conflict, China's zero-COVID policy and the policy responses of countries to deal with inflation. Weak aggregate demand and increased costs lead to a contraction in production and business, investment, and trade activities.

With such an overall economic picture, consumers have become increasingly pessimistic, limiting unnecessary shopping and spending, leading to reduced consumer demand and reduced imports. Vietnam's exports have recorded a sharp decline in many key products. Exports to Sweden have also fallen sharply in 2023.

With the Vietnam - European Union Free Trade Agreement (EVFTA) signed on June 30, 2019 and effective from August 1, 2020, enormous trade opportunities are opening up for Vietnamese and EU businesses, including Sweden.

 However, it is difficult to assess the effectiveness of the EVFTA after more than 3 years of implementation when the agreement was properly implemented during the unstable period of the world economy due to the COVID-19 pandemic, then the Russia-Ukraine conflict that disrupted the supply and demand chain, energy and food crises, inflation is high, people cut spending. However, the EVFTA helps mitigate negative impacts on the economy and will gradually be effective.

The most obvious effect is that tax incentives help many Vietnamese products have a competitive advantage compared to competitors in the market. For example, for rice products, export turnover to Sweden used to be only a few tens of thousand to more than 100,000 USD due to not being able to compete with rice from Cambodia and Thailand, so far the turnover has increased to more than 3 million USD and is gradually increasing market share in this area. Similarly, some agricultural and fishery products with a tax of 0% in the first year also showed a clear competitive advantage.

For some processed and manufactured goods, EVFTA not only brings tax benefits but also helps Swedish businesses be more excited about the Vietnamese market, especially in the context that these businesses have a great demand to find new markets to shift investment and business.

Many Nordic business delegations have gone to Vietnam to survey such as Autoliv Group, specializing in the production of safety products for use in automobiles, with 72 factories in many countries around the world and sales revenue of 8.2 billion USD/year.

However, the Swedish market also has many challenges because of its small population, just over 10 million people, a small market, and high requirements for domestic consumer goods, so businesses in this country mainly import from distributors in the center of the EU. The small market and large geographical distance while there are no direct flights from Vietnam, as well as no cooperation in seaports and airports, also make it difficult to bring Vietnamese goods directly into the Swedish market. In addition, Vietnamese goods are exported to the EU market in general and Sweden in particular, if they want to enjoy tariff incentives, they must first comply with the regulations on origin from the stage of raw material production. Meanwhile, most of Vietnam's key export products have not been able to proactively source raw materials, so this will be a difficulty and challenge for Vietnamese businesses.

In addition to the certificate of origin, Vietnamese enterprises must also comply with other strict regulations, such as environmental issues and technical standards. Overcoming these difficulties, Vietnam's goods will have a firm foothold in the Swedish market in particular and the EU market in general.
Table 1: Import-export turnover and trade surplus between Vietnam and Sweden for the period 2018-2023

 Unit: thousand USD

Source: Vitic