EU coffee project targets 400 firms with 1.4 million-person reach

By Elena Vasquez

A European Union-backed project running from December 2025 through May 2029 in Dak Lak and Son La provinces aims to directly support more than 400 Vietnamese coffee cooperatives and micro, small and medium-sized enterprises (MSMEs).

Funded through the EU’s Global Gateway initiative and implemented by CARE International in Vietnam with local partners, SustainCoffee has an anticipated indirect reach of approximately 1.4 million coffee farmers and supply chain workers. The 1.4 million figure represents broader indirect reach, not direct program beneficiaries.

The scale of the compliance gap

Vietnam’s coffee industry faces mounting environmental, social and governance (ESG) requirements. The European Union accounted for 38% of the country’s coffee exports in the 2025-2026 crop year, making traceability an export-access issue for a major market.

A baseline review by MCG Management Consulting Group for SustainCoffee found gaps between sustainability activity and market-facing governance:

• 84% of surveyed coffee cooperatives and MSMEs had adopted environmental and social sustainability measures.
• 44% had engaged in formal governance practices.
• None had published sustainability reports.
• Only 1% had accessed green credit.

The contrast shows a gap between sustainability practices and the documentation buyers can verify. The project announcement provides no survey sample size, budget, grant amounts or forecast changes in coffee prices and exporter margins.

Only around 30% of Vietnam’s coffee production in 2025 moved through certified or traceable supply chains with geolocation data.

• The remaining 70% continued to move through conventional channels, often relying on paper-based documentation.

The European Union’s Deforestation Regulation adds pressure on exporters to provide reliable traceability systems, geolocation data and evidence of legal production. The project announcement does not state an implementation deadline.

For exporters, the immediate operating requirement is to turn farm and chain records into verifiable origin data. The announcement does not quantify the cost of those systems, the time required for compliance or the effect on margins.

What does this change for coffee suppliers?

SustainCoffee will provide tailored assessment tools, technical training, mentoring and financial support. It will also work with industry associations and local authorities to strengthen ESG advisory services, expand access to green finance and support public-private policy dialogue.

These measures target the gaps identified in the baseline: formal governance, sustainability disclosure, green credit and traceable chains. By strengthening business capacity and improving access to sustainable market opportunities, the project aims to produce a more competitive, resilient and inclusive Vietnamese coffee industry.

Gonzalo Serrano de la Rosa, deputy head of cooperation at the Delegation of the European Union to Vietnam, said the project would strengthen Vietnamese businesses’ competitiveness and participation in responsible global value chains.

“Through SustainCoffee, the European Union is supporting Vietnamese coffee enterprises and producers to strengthen their competitiveness, improve transparency, and participate more effectively in responsible global value chains,” he said.

Le Kim Dung, country director of CARE International in Vietnam, said the transition toward sustainable coffee production must be commercially viable and socially inclusive.

“Many small enterprises and cooperatives are already making efforts to improve their practices, but they often lack the tools, resources, and support needed to demonstrate their progress. SustainCoffee is designed to bridge that gap, translating ESG requirements into practical solutions while ensuring that smallholder farmers, women, and workers are not left behind,” she said.

What changes for suppliers is access to help proving what they already do and filling gaps they cannot finance or document alone. The practical result to watch is whether more shipments carry verified geographic and legal-origin data; the project does not guarantee market access or set a new traceability target.

By May 2029, success will depend on measurable gains from the 44% governance baseline, the absence of published sustainability reports, 1% green-credit access and 30% traceable coverage. If the program closes those gaps, it can help Vietnamese suppliers preserve access to an EU market that took 38% of exports in 2025-2026; if it does not, compliance demands will outpace the capacity of the smallest operators.