Few markets in the world offer greater potential than Vietnam: UK Minister

It is estimated that two-thirds of the world’s middle-class will be in the Asia-Pacific region by the end of this decade. In this context, there are few markets around the world that offer greater potential than Vietnam.

Overview of the webinar.

UK Minister for Exports Graham Stuart made the view in a recent webinar for corporates in the UK to promote trade opportunities between the two countries, while referring to Vietnam as “an historic friend and trusted trading partner with an ever-growing digital economy and unparalleled levels of opportunity for British businesses.”

“Our trading relationship is going from strength to strength, including Vietnam’s support for our accession to the Trans-Pacific Partnership and the recent signing of our Free Trade Agreement [UKVFTA].”

“This landmark deal will bring continuity for trade between our nations, which has tripled over a decade to £5.8 billion [US$8.3 billion] in 2019,” Stuart suggested.

Minister of Planning and Invetment Nguyen Chi Dung at the event.

On this regard, Minister of Planning and Investment Nguyen Chi Dung noted the UKVFTA, kicked off in May, opens a new chapter for both Vietnam and the UK, promoting and enhancing the relationship between the two countries on the basis of economic, trade and investment relations.

“For investment and trade activities from the UK, we appreciate our partners from the UK in terms of financial capacity, technology, market and management skills. And we look forward to more cooperation with British businesses to harness opportunities for Vietnam and leverage the most from the UKVFTA,” Dung said.

Dung, however, said while both countries have enjoyed a tight diplomatic relation, “the trade and investment on the other hand has not developed proportionally compared with both sides’ potential and expectations.”

The Vietnamese minister added in 2020, the country’s economy grew by nearly 3%, among the top growing economies in the world. It is expected that Vietnam's economic growth will reach from 6.5% to 7% in 2021.

“Given Vietnam's existing conditions such as strongly reformed dynamic market, administrative procedures, investment environment, infrastructure and human resources, our country can become an ideal destination for young people, intellectuals and UK businesses to live, work and invest,” Dung continued.

Minister Dung and UK Ambassador to Vietnam Gareth Ward at the event.

Tim Evans, CEO of HSBC Vietnam, echoing Dung’s view by saying there is a huge potential for further growth in Vietnam in coming years, especially with the UKVFTA.

“Vietnam is now ideally placed to attract additional foreign investment from the UK, the fifth largest global investor. The fact that the country is currently only the 15th biggest investor into Vietnam – while actively pursuing its ‘Global Britain’ strategy – highlights the immense potential that the two countries can explore,” said Evans.

In the context of a post-COVID-19 economic recovery, the UKVFTA is a huge boost to both countries, encouraging UK businesses in a range of sectors, such as finance, insurance, education, consulting, high tech, renewable energy, and pharmaceuticals to enter the Vietnamese market.

Going in the other direction, manufacturers in Vietnam stand to gain from the export of products such as electronics, footwear, garments and textiles, woodwork, amongst others. Besides encouraging bilateral trade flows, the UKVFTA is expected to contribute to a more favorable environment for investors in Vietnam.

In the first quarter of the year, bilateral trade turnover stood at US$1.62 billion, of which Vietnam exported goods worth US$1.46 billion to the UK and imports of US$164 million.

As of present, the UK is the 15^th largest investor in Vietnam with a combined investment capital of US$3.87 billion in 411 ongoing projects.