Vietnam and Czechia Elevate Relations to Strategic Partnership

February 7, 2025 Posted by Vietnam Briefing Written by Arendse Huld Reading Time: 4 minutes

During an official visit to Czechia on January 20, 2025, Vietnamese Prime Minister Pham Minh Chinh and Czech Prime Minister Petr Fiala signed a joint statement upgrading bilateral relations to a Strategic Partnership, aiming to strengthen trade and investment ties.

According to their joint statement, Vietnam and Czechia seek to deepen collaboration in a wide range of fields, including defense and security, trade and investment, education, science and technology, the environment, healthcare, and tourism, among others.

The groundwork for the strategic partnership, which comes as the two countries celebrate 75 years of diplomatic ties, was laid during a visit by Vietnamese Vice President Vo Thi Anh Xuan to Prague in November 2024, when she met with Czech President Petr Pavel and Senate Speaker Milos Vystrcil.

Vietnam-Czechia trade and investment

Vietnam and Czechia have deepened bilateral investment and trade ties in recent decades. As a European Union (EU) member, trade between Vietnam and Czechia is facilitated by the EU-Vietnam Free Trade Agreement (EVFTA), which came into force in 2020 and seeks to eliminate almost all tariffs on goods traded between the two regions. Since its implementation, the EVFTA has seen Vietnam’s export value to the EU grow by nearly 50 percent and imports from the EU increase by over 40 percent, according to Vietnam’s Ministry of Industry and Trade (MoIT).

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During his visit to Czechia in January, Prime Minister Pham called for the two countries to leverage the EVFTA to grow bilateral trade to US$5 billion.

According to Vietnam’s General Office of Statistics, in the first 11 months of 2024, Vietnam’s imports from Czechia reached a total of US$207,574, up 33.6 percent year-on-year. Meanwhile, exports from Vietnam to Czechia surged over 101 percent from the same period in 2023, exceeding US$1.6 million.

The PM also called on Czech and Vietnamese companies to increase bilateral cooperation, in particular in emerging industries such as “semiconductor production, big data, artificial intelligence, cloud computing, the Internet of Things, biotechnology, and photonics,” according to the national radio broadcaster Voice of Vietnam.

Among the major Czech companies operating in Vietnam is the automaker Škoda, which is expected to start vehicle production in Vietnam after entering into a US$500 million joint venture with Thanh Cong Group in Quang Ninh province. The company, which will begin producing its Slavia and Kushaq models in Vietnam in the first quarter of 2025, has also stated that Vietnam will serve as the “gateway to other ASEAN countries”.

Meanwhile, the Czech investment group Sev.en Global Investments in August 2024 announced that it would buy an additional 19 percent state in the Mong Duong 2 coal-fired power plant in Cam Pha, Quang Ninh, taking the company’s stake in the plant to 70 percent.

What does the Vietnam-Czechia Strategic Partnership seek to achieve?

Defense and security

In defense and security, the partnership focuses on exchanging delegations, sharing information on strategic issues, and fostering collaboration in defense industries and personnel training. The joint statement also calls for law enforcement agencies from both countries to work together to combat transnational organized crimes, including cybercrime, drug trafficking, and environmental offenses, in alignment with the 2017 Agreement on Combating Crime, a bilateral framework signed between Czechia and Vietnam designed to strengthen collaboration in preventing and combating criminal activities.

Economic cooperation

The joint statement outlines economic cooperation as a key pillar of the partnership, outlining commitments to strengthening the Vietnam-Czechia Intergovernmental Committee on Economic Cooperation led by the respective trade ministries.

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According to the Czech government investment agency CzechTrade, this Intergovernmental Committee “will be pivotal in driving collaboration in sectors such as renewable energy, pharmaceuticals, infrastructure, and the automotive industry.” Tourism ties will also play an important role in economic ties, with efforts to strengthen travel by exploring direct flight routes, promoting tourism development, and training human resources in the sector.

Both sides will also aim to boost collaboration in sectors such as infrastructure, renewable energy, pharmaceuticals, and the automotive industry while leveraging the EVFTA and advocating for the ratification of the EU-Vietnam Investment Protection Agreement (EVIPA). The EVIPA acts as a bilateral investment agreement by providing investment protections and dispute resolution mechanisms. Despite being signed in 2019, it is yet to be ratified by all EU member states.

Education

Besides economic cooperation, the partnership also commits to increasing collaboration in education, science, and technology. It intends to foster university and research collaborations and advance innovation in areas such as biotechnology, digital transformation, and rare earth mining.

Environmental cooperation

Meanwhile, the partnership will seek to boost environmental cooperation by sharing technologies in circular economy practices, waste management, and energy transition. Collaboration in healthcare will focus on medical equipment manufacturing and rare medicine production through investment and technology transfer.

International cooperation

At the multilateral level, the partnership emphasizes aligning positions on global and regional issues, strengthening coordination at international forums such as the UN, WTO, ASEAN-EU, ASEM, and OECD, and advocating for peaceful dispute resolution in line with international law.

Conclusion

The elevation of Vietnam and Czechia’s relationship to a Strategic Partnership marks a significant step in strengthening bilateral ties across various sectors. As both countries celebrate 75 years of diplomatic relations, the partnership is set to leverage existing agreements like the EVFTA to enhance trade, investment, and collaboration in emerging industries, ultimately aiming for mutual growth and stability.

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