On dated December 29 evening (Vietnam time) in London, Representatives from Vietnam and the United Kingdom signed a free trade agreement between the two countries (UK-Vietnam FTA). Earlier on December 11, Minister Anh and UK Secretary of State for International Trade Elizabeth Truss signed the minutes on the conclusion of negotiations over the UKVFTA to create a foundation for the two nations to conduct necessary legal documents for the official signing.
Signing Ceremony for agreed minutes on the conclusion of the UKV-FTA
The UK-VFTA was negotiated based on principles of commitments of the EU-Vietnam FTA with necessary adjustments to ensure the deal conforms with the Vietnam-UK bilateral trade framework.
In the context that the UK official left the EU and the Brexit transition period is about to end on December 31, the signing of the free trade agreement will ensure the bilateral trade cannot be disrupted. It will create a comprehensive, long-term and stable economic-trade cooperation framework between the two countries; thus contributing to deepening their multifaceted cooperation, especially when the two sides just extended the maintenance of bilateral relations at the strategic partnership level.
Accordingly, the deal includes nine articles, one Appendix revising some articles of the EVFTA, one Protocol and one bilateral exchange letter between Vietnam and the UK.
Currently, the two sides are rushing to complete domestic procedures in accordance with the laws of each party so as to ensure the agreement can be implemented from 23:00 on December 31.
In 2019, two-way trade reached 6.6 billion USD; As of the end of October, two-way trade reached only 4.7 billion USD, down about 15%, with Vietnam’s exports to the UK hitting 4.1 billion USD, a decline of 14.19% year on year.
In the first eight months of 2020, the UK run 400 valid projects in Vietnam with total registered capital of 3.6 billion USD, ranking 16th among countries and territories investing in Vietnam. The UK has been the third largest trade partner of Vietnam in Europe after Germany and the Netherlands in recent years.
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.
Vietnam mainly exports garment and textiles, footwear, wood and wooden furniture and seafood to the UK; while importing pharmaceuticals, machineries and equipment from the UK. Fields which the UK is strong in and Vietnam needs include renewable energy, consumer goods production, and greenhouse gas emission mitigation.