Viet Nam, UK conclude bilateral FTA negotiations

Update: 23:07 | 10/12/2020
An agreement on concluding negotiations of the Viet Nam-UK Free Trade Agreement (UKVFTA) will be signed on December 11, according to the Ministry of Industry and Trade (MoIT).
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Vietnam, UK conclude bilateral FTA negotiations
Participants at a conference on Viet Nam-UK trade and investment partnership outlook that takes place in Ha Noi on December 6.

The deal is significant for both countries in the current context as it meets the demands of the two sides.

According to the MoIT, the FTA between the EU and Viet Nam (EVFTA), which has been effective from August 1, will not be applied on the UK after December 31, 2020.

Both Viet Nam and the UK hope to finalise the agreement as soon as possible to promote economic recovery after the COVID-19 pandemic. Meanwhile, the majority of the content in the UKVFTA are similar to those of the EVFTA, saving negotiation time for the deal.

The UKVFTA is expected to help boost tourism cooperation between the two countries, while encouraging partnership in other fields such as development cooperation, defence, security, culture, and education and training.

It also spreads a positive message of the bilateral relations, especially after their recent Joint Statement on bilateral cooperation vision on the occasion of the 10th anniversary of strategic partnership.

Viet Nam and the UK set up diplomatic relations in 1973. Over the past 47 years, bilateral ties have unceasingly developed. According to the General Department of Vietnam Customs, two-way trade reached 6.6 billion USD in 2019.

The UK has been the third largest trade partner of Viet Nam in Europe after Germany and the Netherlands in recent years.

Viet Nam mainly exports garment and textiles, footwear, wood and wooden furniture and seafood to the UK, while importing pharmaceuticals, machineries and equipment from the UK.

Due to impacts of the COVID-19 pandemic, as of the end of October, two-way trade reached only 4.7 billion USD, down about 15 percent, with Viet Nam’s exports to the UK hitting 4.1 billion USD, a decline of 14.19 percent year on year.

In the first eight months of 2020, the UK run 400 valid projects in Viet Nam with total registered capital of 3.6 billion USD, ranking 16th among countries and territories investing in Viet Nam.

However, the investment scale has yet to match the potential of the UK – one of the largest countries in terms of investing abroad with about 300 billion USD each year. The UKVFTA is expected to bring about more investment and cooperation opportunities for the two sides, supporting them in post-pandemic recovery.

Areas which the UK is strong in and Viet Nam needs include renewable energy, consumer goods production, and greenhouse gas emission mitigation.

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(Source: VNA)