The eight-page document, still subject to change, says the EU will also explore the possible transfer of defence technology to Hanoi, as both sides seek closer cooperation on ‘trusted’ telecom networks – at a time when Chinese companies have won contracts in Vietnam’s 5G development.
The two countries will upgrade diplomatic ties to Vietnam’s highest level, similar to the United States, China and Russia. An EU-Vietnam free trade agreement entered into force in 2020.
Vietnam has significant but largely untapped deposits of rare earths and gallium. Hanoi has signalled interest in developing processing capacity for rare earths, whose global supply and refining is dominated by China. But progress has been limited, in part because Vietnam lacks the technology to fully exploit its resources.
Vietnam is also a key supplier of tungsten, a hard metal used in defence and electronics, and Western diplomats have warned of the risk of Chinese interest in a major mine in Vietnam. China’s foreign ministry did not respond to a request for comment.
Vietnam is a major player in chip packaging, testing and assembling, hosting operations by Intel (INTC.O), and Amkor Technology (AMKR.O), among others. Earlier this month Vietnam began building its first semiconductor production facility.