Developing trade and investment ties with Vietnam is a priority for many UK businesses, and once the deal takes effect they will have a range of investment opportunities and are likely to shift existing investment to Vietnam.
He said the EU-Vietnam Investment Protection Agreement (EVIPA) is waiting for ratification from parliaments in some EU member nations, which along with the EVFTA has created trust among EU investors.
Vietnam holds advantages in trade and investment relations with the EU and other countries in the region thanks to the two agreements, as within ASEAN, only Singapore has signed an FTA with the EU. Vietnam, with nearly 100 million consumers, will be a more attractive market for European investors.
COVID-19 is also changing trade practices in the UK, with dependence on Chinese suppliers being lessened. The UK is likely to establish new trade channels with businesses from countries it has signed FTAs with and those parties to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
Cuong added that the EVFTA will help raise the competitiveness of many Vietnamese products over equivalents from countries without an FTA with the UK, such as China, India, Thailand, Malaysia, Indonesia, the Philippines, Myanmar, and Brazil.
Trade between Vietnam and the UK increased by an average of 17.8% per year in the 2010-2019 period, with Vietnam posting a surplus for many years.
Vietnam has exported nearly US$7 billion worth of goods to the UK in the last three years, primarily mobile phones and spare parts, garments and textiles, footwear, fisheries, wood and wooden products, computers and components, cashew nuts, coffee, and pepper.
Bilateral trade was just over US$1.5 billion in the first four months of 2020, a year-on-year decline of 17.8% due to COVID-19.