EU Seeks Stronger Vietnam Mineral Partnership to Reduce Reliance on China

The EU's interest in Vietnam forms part of a broader strategy to strengthen economic security amid mounting concerns over China's dominance in critical mineral supply chains. Internal documents prepared by the EU delegation in Hanoi in June 2026 identified Vietnam as a potentially important alternative supplier, particularly for tungsten and rare earth elements. Vietnam holds significant deposits of these resources, alongside antimony, bismuth and bauxite, from which gallium can be obtained as a byproduct. However, its existing mineral exports to Europe have largely consisted of tungsten and antimony, both of which are important for defense applications, including ammunition and explosives. The initiative aligns with the EU's Critical Raw Materials Act, which establishes benchmarks for 2030, including meeting 10% of annual strategic raw material consumption through domestic extraction, 40% through domestic processing and 25% through recycling. The legislation also seeks to prevent any single non-EU country from supplying more than 65% of a strategic material at a relevant processing stage.

The proposed cooperation extends beyond purchasing Vietnamese minerals and could involve direct European support for developing local extraction, processing and refining capacity. According to the documents, potential financing instruments include loans, grants, technical assistance and export credit insurance, alongside efforts to improve geological mapping and resource assessment. European officials have emphasized the importance of maintaining and expanding access to tungsten, bismuth, antimony and titanium, particularly after China's export restrictions disrupted international supply chains. Processing investments may offer a more practical entry point because they are considered less politically sensitive than mining activities in Vietnam. Supporting local processing could also help European companies secure higher-value mineral products rather than relying exclusively on raw material exports. The strategy follows the European Commission's October 9 selection of 46 additional strategic raw material projects across 16 EU countries, highlighting the bloc's parallel efforts to increase domestic capacity and build overseas partnerships.

Competition for Vietnamese mineral assets has created additional pressure for Brussels to accelerate its engagement. The EU documents raised concerns about an unsuccessful acquisition proposal involving Masan High-Tech Materials, an important tungsten supplier, which Reuters reported had been associated with Australian mining company EQ Resources. The documents suggested that changes in ownership could affect Europe's existing access to strategic mineral supplies. In September, Masan High-Tech sold a 4.99% stake to Elmet Group, a supplier of tungsten to US defense stockpiles, while discussions were also reported concerning the possible sale of another 5% stake to a non-European foreign investor. Meanwhile, a rare-earth processing initiative involving Australia's Lynas Rare Earths and South Korea's LS Eco Energy illustrates how other international companies are seeking to establish positions in Vietnam's emerging mineral value chain. These developments demonstrate that resource diversification is becoming a competitive investment race, with ownership, processing infrastructure and long-term supply agreements potentially determining future market access.

Diplomatic engagement could provide an opportunity to translate Europe's strategic interest into practical commitments. Vietnamese leader To Lam is expected to visit Brussels next week, with meetings reportedly planned for October 22, although the visit had not been officially announced as of October 14. Critical minerals are expected to feature prominently in the discussions, alongside broader economic cooperation. The EU recently removed Vietnam from its list of non-cooperative tax jurisdictions, while the EU-Vietnam Investment Protection Agreement remains subject to outstanding ratifications. Nevertheless, the internal documents identify important challenges, including regulatory uncertainty, limited transparency surrounding Chinese participation in the sector and Vietnamese requirements concerning technology transfers. These factors could complicate investment decisions and delay implementation. For China, the EU's initiative represents another effort by major economies to diversify strategically important supply chains. Although Vietnam cannot immediately replace China's extensive mining and processing ecosystem, stronger European investment could gradually reshape regional mineral trade flows and create new opportunities for Vietnam to become a more significant supplier of high-value industrial materials.