EU, Germany Extend €14M Financial Governance Program in Vietnam

HANOI – Vietnam’s Deputy Minister of Finance Trần Quốc Phương and Ambassador Julien Guerrier, Head of the European Union Delegation to Việt Nam, co-chaired a steering committee meeting on Thursday to review progress on a major economic governance program.

The meeting in Hà Nội focused on Component 1 of the Enhancing Economic Governance Programme (EEGP), a key initiative aimed at modernizing the country's public financial management.

In his opening remarks, Phương highlighted the strength of the Việt Nam-EU relationship, which has been elevated to a Comprehensive Strategic Partnership with economic, trade, and investment cooperation as its central pillars. He noted that after more than three decades of cooperation, the EU has become one of Việt Nam’s leading partners, contributing significantly to its international integration and sustainable development. Agreements such as the EU-Vietnam Free Trade Agreement (EVFTA) and the EU-Vietnam Investment Protection Agreement (EVIPA) provide a solid foundation for stronger bilateral economic ties, he added.

Amid global challenges including climate change, digital transformation, and economic uncertainties, Phương praised the EU’s support for Việt Nam in pursuing sustainable development and green growth. He said cooperation priorities under the Multiannual Indicative Programme (MIP) for 2021–2027, the Global Gateway initiative, and Team Europe align closely with Việt Nam’s development objectives.

The Ministry of Finance is a direct beneficiary of the EEGP. Component 1, launched in October 2022, concentrates on strengthening medium-term public financial management, including budget management, revenue forecasting, public debt management, and tax policy reform. According to Phương, this component has delivered positive results by helping to improve institutions and strengthen capacity. Research, policy advisory services, and international experience-sharing activities have supported economic governance reforms towards greater transparency and efficiency.

At the meeting, representatives of the German Agency for International Cooperation (GIZ) reported on the project’s implementation. Jointly funded by the EU and the German Government with a budget of €14 million (US$16.1 million), the programme is being carried out from 2022 to 2026. After more than three years of implementation, the project has recorded notable results across its three pillars.

In budget management, it supported revisions to the State Budget Law, which took effect on January 1, 2026, and helped develop macroeconomic and revenue forecasting tools to enhance Việt Nam’s forecasting capacity. In public debt management, the project contributed to revisions of the 2025 Law on Public Debt Management, helping to improve the legal framework in line with international standards. In taxation, it supported reviews and reforms of key tax policies aimed at expanding fiscal space and improving revenue administration. The programme has also promoted international integration in finance and taxation and incorporated gender equality considerations into public financial management.

Ambassador Guerrier praised the close cooperation among the EU, Germany, and Việt Nam’s Ministry of Finance. He said the programme has advanced fiscal reforms, modernised budget management tools, enhanced transparency, and improved state budget revenue mobilisation. Guerrier stressed the importance of continuing reforms in budget management, tax policy, public debt management, and customs, while increasing consultations with the business community, particularly European enterprises, to ensure policies remain practical and conducive to a transparent and stable investment environment.

German Ambassador to Việt Nam Helga Margarete Barth reaffirmed Germany’s commitment to supporting Việt Nam in public financial management, noting that over three decades of cooperation have helped improve transparency, accountability, and the efficiency of resource allocation.

The Steering Committee agreed in principle to extend Component 1 by nine months until June of next year. Phương said the extension would help maximise the programme’s impact, strengthen economic governance, and support Việt Nam’s sustainable development goals.