The “Vietnam-UK Free Trade Agreement” (UKVFTA) came into effect on May 1, 2021, and will create new impetus for the economic and trade cooperation between the two sides.
However, in order for Vietnamese products to penetrate the British market deeply, trade experts believe that Vietnamese companies must carefully understand the local culture and learn more about payment methods and distribution channels.
The UKVFTA agreement clearly states that after the agreement comes into force, the import tax on Vietnamese textiles (mainly textile raw materials and their products) will be reduced from the previous 12% to zero. This is a good opportunity for Vietnamese export products to penetrate the potential UK market. There will also be more and more goods shipped from Vietnam to the UK.
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In addition, footwear products also have a great opportunity to enter the market. After the Vietnam-EU Free Trade Agreement (EVFTA) takes effect, the UK’s import tariffs on Vietnamese footwear and apparel will immediately drop from an average tax rate of 6.7% to zero.
China’s textile and apparel exports to the UK have fallen!
The UKVFTA agreement not only opens up trade in goods and services but also incorporates many other important factors, such as green growth and sustainable development.
The UK is Vietnam’s third-largest trading partner in Europe. According to statistics from the General Administration of Customs of Vietnam, in 2019, the total value of imports and exports between the two countries reached 6.6 billion U.S. dollars, of which exports reached 5.8 billion U.S. dollars and imports reached 857 million U.S. dollars. During the period from 2011 to 2019, the average annual growth rate of the total bilateral import and export volume of Vietnam and Britain was 12.1%, which was higher than Vietnam’s average annual rate of 10%.
The main products that Vietnam exports to the UK include mobile phones and their spare parts, textiles and clothing, footwear, aquatic products, wood and wood products, computers and parts, cashew nuts, coffee, pepper, etc.
Vietnam’s imports from the UK include machinery, equipment, medicines, steel, and chemicals. The imports and exports between the two countries are complementary rather than competitive.
Britain’s annual merchandise imports total nearly 700 billion U.S. dollars, and Vietnam’s total exports to the United Kingdom account for only 1%. Therefore, there is still a lot of room for Vietnamese products to grow in the British market.
After Brexit, the benefits brought by the “Vietnam-EU Free Trade Agreement” (EVFTA) will not apply to the UK market. Therefore, signing a bilateral free trade agreement will create convenient conditions for promoting reforms, opening markets, and trade facilitation activities on the basis of inheriting the positive results of EVFTA negotiations.
The Ministry of Industry and Trade of Vietnam stated that some commodities with export growth potential in the UK market include textiles and clothing. In 2019, the UK mainly imports textiles and clothing from Vietnam. Although China has the largest market share in the UK market, the country’s textile and apparel exports to the UK have fallen by 8% in the past five years.
In addition to China, Bangladesh, Cambodia, and Pakistan also export textiles and clothing to the UK. These countries have an advantage over Vietnam in terms of tax rates. Therefore, the free trade agreement between Vietnam and the United Kingdom will bring preferential tariffs, which will help Vietnamese goods have a more competitive advantage over other competitors.
At the same time: the CPTPP agreement paves the way for Vietnamese goods to enter the Americas
Two years after the CPTPP took effect, Vietnam’s exports to the CPTPP member states have soared. At the same time, the CPTPP agreement has become a driving force for Vietnamese products to enter markets in the Americas with huge potential.
The Deputy Minister of Industry and Trade of Vietnam made this statement at the seminar “CPTPP-Opportunities for Vietnamese Products to Open up Markets in Europe and America” held on April 27 by the European and American Marketing Department in a combination of online and offline forms.
In 2020, despite the severe impact of the corvid-19 epidemic, the total import and export volume between Vietnam and the Americas reached nearly 111.5 billion U.S. dollars, an increase of 16% over 2019; of which, exports reached 89.7 billion U.S. dollars, an increase of 21.7%, accounting for Vietnam’s total exports Of 31.7%.
After two years of implementation, Vietnam’s exports to Canada and Mexico, which have ratified the CPTPP agreement, have grown strongly, reaching US$4.4 billion (an increase of 45%) and US$3.17 billion (an increase of 41%), respectively.
In addition, Vietnam’s exports to other countries that have not yet ratified the agreement have also grown rapidly. For example, Vietnam’s exports to the Chilean market and Peru increased by 30% and 21% year-on-year respectively. In the first three months of 2021, Vietnam’s exports to the CPTPP member states in the Americas also maintained a good growth momentum.
“The hope of India becoming the next China’ is zero”
India’s COVID-19 pandemic is a tragedy, and its hopes of becoming the “next China” are zero
On May 3, two tweets posted on social media by Martin Jacques, a well-known British scholar and “China Communication”, aroused discussion among foreign netizens. In his tweet, he called “India’s covid-19 pandemic is a tragedy” and bluntly stated that “the hope of India becoming the “next China” is zero.” In addition, Martin Jacques also praised China for its “excellent performance” in the fight against the epidemic and listed several of the worst-performing leaders in the fight against the epidemic, including former U.S. President Trump, Brazilian President Bolsonaro, British Prime Minister Johnson, and Indian Prime Minister. Modi.
The long-term consequences are huge. The hope of India becoming the next China’ is zero. “↓
In the second tweet, Martin Jacques continued: “One year ago, the West launched a shameful attack and blamed the COVID-19 on China. In fact, China performed well. The worst performers were Trump, Bol Sonaro, Johnson, and Modi. China passed a huge governance test with outstanding results, but the United States and its allies messed up.”↓