Contributing to this result, the United Kingdom-Vietnam Free Trade Agreement (UKVFTA) has played the role as a solid lever, thanks to the reduction of import tax to zero after January 1, 2021. Therefore, many products have outstanding competitive advantages in the U.K. market compared to similar products from China, Thailand, Malaysia, Indonesia and many other countries.

Delegates participating in the conference

The information was shared by Deputy Minister of Industry and Trade Tran Quoc Khanh at a conference named “One-year journey of the UKVFTA: Remarkable achievement and the vision ahead,” jointly held by the Ministry of Industry and Trade and the U.K. Embassy in Vietnam on March 15 in both online and in-person formats.

Data from the Ministry of Industry and Trade showed that one year after the UKVFTA took temporary effect, trade exchange between the two countries has grown well. In 2021, two-way trade hit 6.61 billion USD, up 17.24 percent year-on-year, in which Vietnam's exports to the U.K. increased by 16.4 percent and the latter's exports rose by 24 percent.

In the year, there were 48 direct investment projects from the U.K. into Vietnam, with newly registered capital of more than 53 million USD, a year-on-year surge of 157 percent, thus helping maintain its total direct investment in the Southeast Asian nation at 4 billion USD. Currently, the U.K. is among 12 countries with the largest FDI capital in Vietnam.

These figures showed that the UKVFTA is really a “two-way expressway,” helping to promote bilateral trade between the two countries in a more and more balanced direction.

Khanh emphasized that the UKVFTA is expected to help Vietnam accelerate its institutional reform, improve the investment environment in a modern and transparent manner and create maximum convenience for businesses.

However, after leaving the European Union, the U.K. is actively negotiating free trade agreements with many partners around the world, including some ASEAN countries. Therefore, the competitive advantage Vietnam has will soon be lost if the U.K. inks similar pacts with other countries, he noted, asking Vietnamese enterprises to quickly gain a firm foothold in this market, because the potential remains huge.

Sharing the same view, Luong Hoang Thai, Director of the Multilateral Trade Policy Department under the Ministry of Industry and Trade, stated that Vietnamese goods exported to the U.K. account for less than 1 percent of the European country's total imports. On the other hand, the U.K.’s exports also account for a small portion of Vietnam's imports.

Speaking at the event, MP Graham Stuart, trade envoy of the British Prime Minister in charge of Laos, Vietnam and Cambodia, emphasised that the U.K. has strengths and experience in renewable energy, including offshore wind power. Therefore, the U.K. is willing to share its experience with Vietnam to promote trade between the two countries.

Source: VNA