Vietnamese goods to better penetrate UK market

Illustrative image (Photo: VNA)

When the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) has the UK as a new member, more cooperation opportunities will open up for Vietnam and the European country, according to insiders.

With the signing of the protocol on the UK’s accession to the CPTPP last weekend, the number of CPTPP member states has amounted to 12.

The UK's entry is expected to raise the bloc’s gross domestic product (GDP) to nearly 16% of the world’s total from 12%. The CPTPP will be an additional agreement alongside the Free Trade Agreement (FTAs) that the UK is having with most member countries.

According to experts, investment between the UK and CPTPP member states is expected to hike thanks to terms that limit barriers and encourage more internal investment.

As of June, the UK recorded 530 foreign-invested projects worth over 4.26 billion USD in Vietnam, ranking 15th among the 141 countries and territories investing in the country. Last year, the European nation invested in 53 new projects valued at 64.3 million USD in Vietnam.

After the UK-Vietnam FTA officially took effect on May 1, 2021, two-way trade rose to 6.84 billion USD last year, up 3.4% annually. Of the figure, 6.07 billion USD was Vietnam’s exports to the UK, up 5.2%, resulting in a trade surplus of around 5.3 billion USD, higher than 4.8 billion USD recorded in the previous year.

On the back of the CPTPP, the two countries are seeing ample opportunities to soon achieve the target of 10 billion USD in bilateral trade. The Vietnamese agro-aquatic products, including fruits and vegetables, coffee, cashew nut, are to benefit the most. Several export items to the UK, which have not been granted tax exemptions based on bilateral agreements, will enjoy more favourable taxes under the CPTPP.

Illustrative image (Photo: vneconomy.vn)

Meanwhile, products such as whisky and automobiles, which are among the 99% of the UK’s current exports to CPTPP countries, will qualify for tax exemptions. At the same time, the UK is likely to export more agricultural products, pharmaceutical materials, advanced equipment and technology to Vietnam.

CEO of the UK-based TT Meridian Ltd Thai Tran said Vietnamese farm produce such as durian, pomelo and Cao Phong orange have gradually conquered the UK market.

According to him, the UK has high requirements as it not only pays attention to prices but also environmental, social and governance standards./.