A practical scenario: an electronics maker wants a factory serving the EU. Option A: Poland — inside the EU, near customers, no intra-bloc duties. Option B: Vietnam — far lower labor costs, EU-bound goods under EVFTA. Leadership debates for 6 months. This is a strategy question — with no universal answer.
1. Poland: the EU home ground
A Polish factory means manufacturing inside the EU: free circulation across 27 states with no duties, no intra-bloc customs; customer proximity (fast delivery, low logistics costs); ready EU supply chains. On tax: 19% CIT (9% for small taxpayers), Polish Investment Zone incentives. Downsides: much higher labor costs than Vietnam, and full EU regulation compliance (labor, environment, ESG — strict and costly).
2. Vietnam: the low-cost workshop + EVFTA
A Vietnamese factory: far lower labor and land costs; tax incentives (20%/15%/17% CIT under Law 67/2025 + project holidays); EU-bound exports under EVFTA (phased duty elimination for most goods — EUR.1 origin certification needed). Downsides: geography (4–6 weeks by sea, logistics costs, supply-chain risk); rules-of-origin risk (losing preferences without origin proof); EU-bound goods must still meet EU standards (CE, ESG, contractual CSDDD).
3. A decision framework
- Main market is the EU: Poland wins — proximity, no intra-bloc duties, fast delivery.
- Global markets, price competition: Vietnam wins — low costs, EVFTA plus other FTAs.
- Bulky/expensive-to-ship products: Poland — logistics outweigh labor savings.
- Labor-intensive products: Vietnam — wage gaps decide.
- Dual strategy: many groups build both — Poland for the EU, Vietnam for the world.
Factory location is a 20-year strategic decision
This article is general information. Each project needs its own analysis. FLAT Law Firm helps investors evaluate Vietnamese locations. Contact us for advice.
This article is general information only and does not replace legal advice for any specific case. Regulations may change; please check the current texts.
Frequently asked questions
1. What are Poland’s advantages?
Inside the EU: no intra-bloc duties, customer proximity, ready EU supply chains, 19%/9% CIT.
2. What are Vietnam’s advantages?
Low labor/land costs, tax incentives, EVFTA access to the EU.
3. How does EVFTA help Vietnam-to-EU goods?
Phased duty elimination for most goods — EUR.1 origin certification required.
4. What are Vietnam’s downsides?
Geography (logistics), origin-rule risks, and still having to meet EU standards.
5. Should we build in both?
Many groups do — Poland for the EU, Vietnam for global markets (dual strategy).
This article has been quality-reviewed by the FLAW AI Legal Council