At the event (Photo: VNA) London (VNA) - An online dialogue on policies and markets held on October 6 offered Vietnameseand UK enterprises an insight into the opportunities and challenges in tradeand investment ties between the two nations following the UK’s withdrawal fromthe EU.
Vietnamese Ambassadorto the UK Tran Ngoc An told the gathering that not only are UK firms interestedin the Vietnamese market but Vietnamese firms are also keen on boosting exportsto the UK, primarily electronics, farm produce, and aquatic products.
Vietnamese exporters nowenjoy benefits under the Generalised System of Preferences and the EU-VietnamFree Trade Agreement (EVFTA). Post-Brexit incentives starting from December 31,2020, however, depend on the outcomes of negotiations over an FTA betweenVietnam and the UK.
The EVFTA, which tookeffect on August 1, applies to trade between Vietnam and the UK to later thisyear, when the UK ends the Brexit transition period.
The Vietnamese and UKGovernments want to have an FTA next year with low or zero taxes on almost all goods,he said.
Commenting on theprospects for Vietnam-UK trade, Vietnamese Commercial Counsellor in the UKNguyen Canh Cuong said that, in the last three years, Vietnam has annually earned nearly6 billion USD from the UK while spending nearly the same on imports.
There remains huge roomto move for Vietnamese goods in the UK, as they account for just 1 percent ofthe UK’s total imports of around 700 billion USD.
The prospects for bilateraltrade ties, he said, rely on Vietnamese firms’ competitiveness and the twoGovernments’ efforts to reach a bilateral FTA on the basis of the EVFTA.
If a bilateral FTA isreached, Vietnamese goods would gain a competitive edge over those from China,India, Thailand, Malaysia, Indonesia, the Philippines, and Myanmar, which areless likely to sign a deal with the UK in the immediate future. Moreover, notmany UK goods compete directly with equivalents made in Vietnam.
Instead of inheritingthe EU-Vietnam Investment Protection Agreement, the UK wants to continue withthe Vietnam - UK Investment Protection Agreement 2020, which will last until August2022.
Without an FTA post-Brexit,Vietnam-EU trade ties will be adjusted in accordance with multilateralcommitments in the WTO. Vietnamese exports to the UK will decline due tocompetition with 32 countries and economic alliances having FTAs with the UK.
Vietnam’s exports tothe UK fell nearly 20 percent in the first half year-on-year but rose 14percent month-on-month in August thanks to the EVFTA’s tax preferences.
Cuong said Vietnameseshipments to the UK are forecast to continue recovering between now and the endof the year. The two countries’ firms expect a bilateral FTA will be reached./.
