With great export prospects from the UK-Vietnam Free Trade Agreement (UKVFTA), exports to the UK may make up more than a single per cent ($700 billion) of Vietnam's import turnover.
|The UKVFTA was signed on December 29, 2020 |
About 65 per cent of the UK’s import taxes were erased as soon as the agreement took effect from December 31, and the rest will be eliminated in the course of the next 10 years. Meanwhile, 81 per cent of Vietnam’s import taxes on UK goods will be cut and the remainder will be steadily removed in the next seven years.
Forbes Vietnam quoted Alex Falter, vice chairman of BritCham Vietnam as saying that the UKVFTA would optimise the advantages of the two sides and other third parties. “Along with bilateral trade, investment flows from the UK to Vietnam will keep increasing.”
According to BritCham Vietnam, Vietnam is the second-largest exporter in the region to the UK. Therefore, with the free trade agreement in effect, trade turnover will hopefully inflate. Of this, Vietnamese export goods like rice, seafood, timber, garments, and footwear are likely to proliferate in the UK, while Vietnam is looking forward to large UK investment in education, renewable energy, and infrastructure.
The UK is the sixth-largest economy in the world where “Vietnamese companies must constantly renew themselves to approach effectively.”
The nation is the third-biggest trade partner of Vietnam in the EU. According to the General Department of Customs of Vietnam, in 2019, bilateral turnover reached $6.6 billion, including $5.8 billion in export value and $857 million in import value. In 2011-2019, bilateral trade grew at an average 12.1 per cent, higher than Vietnam's average trade growth of 10 per cent with other countries.