Webinar looks into opportunities and challenges for exports to UK

The Ministry of Industry and Trade of Vietnam on December 15 held a webinar on Vietnam-UK trade prospects, alongside opportunities and challenges in the post-Brexit context and the COVID-19 pandemic.

The event featured the attendance of representatives from the Ministry of Industry and Trade, the UK-ASEAN Business Council (UKABC) the Vietnam Trade Office in the UK and both nations' businesses.

According to Ta Hoang Linh, director of the Europe-America Market Department under the MoIT, despite suffering the impact of the COVID-19 pandemic, Vietnam-UK trade sees positive developments., with two-way trade turnover over the past 10 months of this year reaching more than US$5.4 billion, representing a year-on-year rise of 16%, of which Vietnam enjoyed a trade surplus of US$4.03 billion.

Throughout the reviewed period, Vietnam's total export turnover to the UK grew by 14.5% to more than US$4.73 billion. At present, the UK ranks 9th among the main export markets of the Southeast Asian nation.

Most of Vietnam's export staples enjoying high growth include iron and steel, rubber, farm produce, rattan, bamboo, sedge and carpet products; pepper, transport vehicles, machinery, equipment, tools and spare parts.

In his address the event, Ian Gibbon, UKABC Chief Executive stated that bilateral trade between Vietnam and the UK in 2019 tripled to more than US$6 billion compared to one year earlier. In 2020, in the context of the COVID-19 outbreak causing disruption to the global trading system, Vietnam's export value to the UK still reached nearly US$5 billion.

He highlighted the effective enforcement of the UK-Vietnam free trade agreement (UKVFTA) as a driving force behind the promotion of economic cooperation in the two countries' strategic partnership. The two sides boast huge potential for stronger cooperation in the fields of trade, clean and renewable energy, and the digital economy, he added.         

Nguyen Canh Cuong, Trade Counselor of the Vietnamese Embassy in the UK, said that after Brexit, the new trade relationship between the UK and the EU is no longer as favorable as in a common market. British businesses therefore must stay active in finding new sources of supply and new markets, including Vietnam - one of the strong emerging economies in Southeast Asia and the second country to sign an FTA with the UK.

Notably, the UK Government is carrying out a more open trade policy toward faster liberalization, thus encouraging British businesses to boost exports in countries with dynamic economic development, including Vietnam. This is viewed as an opportunity for the two sides to promote trade and business cooperation in the time ahead, Cuong went on to say.

Giving advice to local enterprises exporting to the UK market, business representatives underlined the need for them to carefully study market needs, culture and then seek suitable business partners through many different channels.

The UK is currently a major importer of Vietnam, however, the Southeast Asian nation's market share in this potential market remains quite modest, accounting for only about 1% of the total import turnover of the European nation.

According to the participants at the webinar, the UK market also poses many challenges to Vietnamese businesses, especially after the country leaves the EU. As a result, procedures regarding certificates, customs control over animals and plants, tax declaration and payment, will be subject to new British guidelines.