Viet Nam has emerged as a major Southeast Asian supplier of farm produce and aquaculture products to the UK following the UK-Vietnam Free Trade Agreement (UKVFTA) they signed, speakers said at a conference on Thursday.
Speaking at ‘UK Market: Unlocking great potential by leveraging advantages of the UKVFTA,’ Oliver Todd, British consul general in HCM City, said Viet Nam could replace other countries such as India and Indonesia as a major supplier of agricultural and aquaculture products to his country.
Todd, who is also director of UK Trade and Investment in Viet Nam, said Vietnamese exporters should be well prepared if they want to boost exports to the choosy market. It is important to learn about import demand and standards and requirements for exporting to the British market, he said.
Chris Milliken, vice president of the British Chamber of Commerce in Viet Nam (BritCham), said there is ample scope to grow bilateral trade thanks to the trade deal.
“Viet Nam and the UK are not competing against each other in any industry; they commercially complement each other.”
He pointed to the FTA as the leading pillar of the joint commitment to deepen bilateral trade, saying it was a mutual agreement to take bilateral trade to the next level.
The bilateral cooperation would include renewable energy, finance, education, high-tech, fintech, and others, he said.
The UK has in recent years focused on developing renewables such as wind and solar power as part of its efforts to adapt to climate change, he said.
He said Viet Nam should develop renewable energy, an area in which the UK has strengths.
The UK recently developed an offshore wind project in the country, which would generate enough electricity for 1.6 million homes.
Major UK energy enterprises invest in solar power projects in Viet Nam like the Shire Oak International Group, and solar power projects like Enterprize Energy and Mainstream Group.
He also spoke highly of the commitment by Viet Nam to achieve net-zero emissions by 2050 to help mitigate climate change at the COP26 last year.
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Truong Thi Chi Binh, vice president and general secretary of the Viet Nam Association of Supporting Industry Enterprises, said the two countries have great opportunities for cooperation in many fields, especially supporting industries and renewable energy.
Vo Hong Kiet, customer service manager at the British Standards Institute (BSI Group), said Viet Nam has the potential to become a major supplier of food and farm produce to the UK.
But Vietnamese exporters face challenges in finding partners and understanding the needs, quality standards and trade procedures in the UK, and also face risks related to contracts and payments, he added.
Nguyen Manh Dat, deputy director of the Institute of Food Industry under the Ministry of Industry and Trade, said Vietnamese exporters should do thorough market research to ensure their products are of high quality and competitive in the market.
They must also ensure transparency for their products by developing websites and providing information about products, production lines, output, and trading partners.
Experts said the UK is the second largest economy in Europe with a free trade policy and large demand for agricultural imports.
Although the UKVFTA took effect at a tough time due largely to the COVID-19 pandemic, the two countries were able to achieve bilateral trade of US$6.6 billion last year, up 17.2 per cent from the previous year, according to figures from Viet Nam Customs.
Viet Nam’s exports to the UK were worth $5.8 billion in 2021, up over 16.4 per cent, while the UK’s exports topped $849 million, up 23.6 per cent.
In the first five months of this year, trade between the two countries reached $2.68 billion.
As of May, 462 UK direct investment projects with total registered capital of $4.15 billion were approved in Viet Nam, accounting for 0.97 per cent of the country’s total FDI.
They include 120 projects in the manufacturing and processing sectors with a total investment of nearly $1.6 billion, followed by 23 projects in real estate worth a total of $1.04 billion.
The signing of the UKVFTA took place in December 2020 in the British capital, London. It came into force on May 1, 2021.
The conference was organised by the Ministry of Industry and Trade, the British embassy in Viet Nam and the British Chamber of Commerce in Viet Nam to help Vietnamese enterprises seeking to join the British supply chain. — VNS