|Vietnam - UK boost trade, energy cooperation|
|Vietnam-UK free trade agreement continues to promote bilateral trade|
|Bilateral FTA between Vietnam and UK officially signed in London|
As assessed by the European-American Market Department under the Ministry of Industry and Trade (MOIT), this is a really impressive growth rate in the context of many trading partners of Vietnam encountering difficulties due to the impact of the COVID-19 pandemic. Such an optimistic signal is even more meaningful in light of the fact that the Vietnam-UK Free Trade Agreement (UKVFTA) has been temporarily applied since January 1, 2021, promising to continue creating new motivation for bilateral economic-trade cooperation in the near future, Nhan Dan Newspaper reported.
|Vietnam exports US$19.72 million of seafood to the UK in January 2021, up over 18% year-on-year. Photo: Nhan Dan|
In the structure of Vietnam’s export items to the UK, agricultural exports remained stable and positive growth, with seafood exports reaching US$19.72 million (up more than 18% year-on-year) and fruit exports hitting more than US$1 million (up 148.6%). These are all commodity industries with many opportunities for increased export value through tariff preferences as prescribed by the UKVFTA.
According to UKVFTA commitments, the import tax on most raw shrimp (fresh, frozen, chilled) into the UK will be reduced from the basic tax rate of 10-20% to 0% as soon as the agreement comes into force. For vegetables and fruits, it will immediately eliminate 94% of the total 547 tariff lines. Many products of Vietnam’s strength such as litchi, longan, rambutan, dragon fruit, pineapple, and melon, will have more market access advantages compared to tropical fruits originating from competing countries like Brazil, Thailand, and Malaysia which have not signed an FTA with the UK.
|Exports of agricultural products to the UK maintain steady growth. Photo: VOV|
The manufacturing industry also registered amazing growth regarding its January exports to the UK, with US$252.59 million of phones and spare parts (up more than 371% year-on-year); US$74.58 million of machinery, equipment, and spare parts (up nearly 110%); US$31.82 million of computers and electronic components (up 91%); and US$15.96 million of iron and steel of various types (up 11%).
Meanwhile, Vietnam imported over US$59 million worth of products from the UK last month, up 34.3% compared to January 2020. Some commodity groups posted remarkable year-on-year growth in terms of turnover, including metals (excluding steel) (US$467,000, up more than 1,462%), pesticides and raw materials (US$1.04 million, up over 505%), and garment & textile materials (more than US$3 million, up more than 131%).
Vietnam continued to enjoy a trade surplus with the UK market in January, at an estimated US$598 million, representing an increase of 113% over the same period last year.
In 2020, Vietnam-UK trade reached US$5.64 billion, with Vietnam exporting US$4.95 billion of products and enjoying a trade surplus of US$4.27 billion. The UK continued to be the third-largest trading partner of Vietnam in Europe, after Germany and the Netherlands.
In terms of investment, by the end of December 2020, the UK has 411 projects in Vietnam with a total registered capital of US$3.84 billion, ranking 15th among the 139 countries and territories investing in the Southeast Asian country. The UK’s projects mainly focus on the areas of banking-finance, oil, and renewable energy.
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 of 12.1 percent, higher than Vietnam's average trade growth of 10 percent with other countries.
The United Kingdom-Viet Nam Free Trade Agreement (UKVFTA) was officially inked in London, the UK on December 29.
According to the representative of the Ministry of Industry and Trade, the UKVFTA was negotiated based on principles that were inherited from commitments in the EU-Viet Nam Free Trade Agreement (EVFTA) and were amended in accordance with the bilateral trade framework between Viet Nam and the UK.
Thanks to the UKVFTA, interests in the bilateral trade ties within the EVFTA will be maintained. The agreement begins a new period in the two nations’ relationship, particularly in key trade sectors.
The Agreement not only liberalizes trade, commodity, and services but also integrates other crucial factors, such as heading to green growth and sustainable development.
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