Iceland Signs EFTA Free Trade Agreement with Vietnam, Opening New Export Opportunities for Seafood and Geothermal Technologies

According to reports from Iceland, on October 21, 2026, Iceland Review reported that Iceland had signed the Free Trade Agreement between the European Free Trade Association (EFTA) and Vietnam, paving the way for improved access to a market of more than 100 million consumers for Icelandic exporters.

Iceland’s Minister for Foreign Affairs, Þorgerður Katrín Gunnarsdóttir, signed the Agreement on behalf of Iceland in Hanoi in October 2026. The Icelandic Government published an official announcement concerning the signing on October 20, 2026.

According to Iceland Review, the Agreement provides for the elimination or reduction of import tariffs on nearly all products currently exported by EFTA member states to Vietnam. Some products will become duty-free upon the Agreement’s entry into force, while others will benefit from phased tariff reductions.

The Agreement is expected to be particularly significant for Iceland’s seafood industry, one of the country’s most important export sectors.

In 2025, Iceland’s merchandise exports to Vietnam reached approximately ISK 452 million, an increase of 40% compared with the previous year. Seafood accounted for around 93% of total export value, with mackerel representing the largest product category.

Beyond the seafood sector, the Icelandic Government has identified geothermal technologies and expertise as areas that could benefit from improved access to the Vietnamese market.

In addition to trade in goods, the Agreement covers trade in services, investment, government procurement, intellectual property rights, rules of origin, small and medium-sized enterprises, as well as commitments relating to labour, climate and environmental protection.

According to the Icelandic Government, the Agreement will help businesses from EFTA member states gain access to the Vietnamese market on terms comparable to those enjoyed by certain major competitors that already have trade agreements with Vietnam.

However, at the time of the announcement, the parties had not specified an exact date for the Agreement’s entry into force or a timetable for completing domestic ratification procedures. Consequently, the preferential tariff arrangements under the Agreement did not take effect immediately upon its signing.