(VOVWORLD) - The UK-Vietnam Free Trade Agreement (UKVFTA) was signed on December 31, 2020. It marks a new beginning for a bilateral strategic partnership which began a decade ago.
 Vietnam's Ambassador to the UK Tran Ngoc An and UK's Ambassador Gareth Ward sign the UKVFTA. (photo: VNA) |
A turning point in Vietnam-UK strategic partnership
The UKVFTA is a giant step in Vietnam-UK economic and trade cooperation. The two countries established diplomatic ties 47 years ago and a strategic partnership 10 years ago.
The free trade agreement is of great importance for both sides, particularly when countries worldwide are enhancing trade and investment cooperation to quickly recover economies shredded by the COVID-19 pandemic.
The UKVFTA aims to maintain uninterrupted trade between Vietnam and the UK now that the Brexit transition period has ended. Because the UK is no longer a member of the EU and the EU Customs Union, the EU-Vietnam Free Trade Agreement, which took effect on August 1, 2020, is inapplicable in the UK.
The UKVFTA will increase goods export between the two sides and create conditions for market opening and trade facilitation.
The agreement is expected to increase trade revenues with a “win-win” spirit. Trần Ngọc An, Vietnam’s Ambassador to the UK, said: “Before the FTA, bilateral trade increased 15 to 20%. The agreement is expected to boost trade cooperation for mutual benefit. The UK and Vietnamese economies will supplement each other and contribute to their bilateral relationship.”
Bright prospect for trade cooperation
The UKVFTA will create opportunities for British companies to invest or expanded operation. The world’s 5th largest exporter in 2019, the UK’s commodities currently account for less than 3% of Vietnam’s imported products. Pharmaceuticals, equipment, chemicals, vehicles, banking, and insurance are forecast to benefit the most from the FTA.
Ambassador An again: “Being Europe’s 2nd biggest economy and 5th in the world, the UK is interested in many sectors in Vietnam. As a leading financial center, the UK has advantages in services, finance, insurance, and high-tech.”
Vietnam will become a gateway for British companies to access regional markets. Incentive tariffs will boost exports of Vietnamese staples such as smart phones, electronics, garments, textiles, footwear, agricultural products, wood furniture, and pottery.
The UKVFTA opens a big door for Vietnam-UK economic and trade cooperation and raises their bilateral strategic partnership to a new level.