Hanoi (VNS/VNA) - The export of Vietnamese goods tothe United Kingdom (UK) is currently facing several challenges, attributed toboth unfavourable international conditions and shifts in the UK’s trade andeconomic policies. Overcoming these hurdles will require increased proactiveefforts from domestic businesses and regulatory authorities.

Two years into the implementation of the UK-Vietnam Free TradeAgreement (UKVFTA), bilateral trade between Vietnam and the UK showed positiveresults. The total trade exchange reached 6.8 billion USD in 2022, up 3.3%growth compared to 2021.

However, due to the global economic downturn and challenges withinthe UK economy, the import-export volume between Vietnam and the UK hasexperienced a downward trend in the early months of 2023. Although recentmonths have witnessed a slight upward trajectory, Vietnam’s customs statisticsreveal that the accumulated trade volume for the first eight months of 2023reached 4.62 billion USD, a marginal 0.9% decrease compared to the same periodlast year. Vietnam's exports to the UK amounted to nearly 4.1 billion USD, aslight 0.1% decrease, while imports from the UK increased by 6%, reaching 460.1million USD.

Nguyen Canh Cuong, Trade Counsellor of the Vietnamese Embassy inthe UK, said Vietnamese exporters are facing challenges arising from the UK'sintensification of its independent economic policies and the signing ofadditional free trade agreements (FTAs) with other partners.

Notably, the UK has been negotiating FTAs with India, Mexico,Israel, and the Gulf Cooperation Council (GCC), while also launching FTA talkswith Switzerland, its 10th-largest trading partner with a bilateral tradevolume of nearly 53 billion GBP.

On 31 May this year, two new FTAs between the UK and Australia andNew Zealand also came into force.

Moreover, recent policy changes, such as the UK's replacement ofthe Generalised Scheme of Preferences (GSP) with the Developing CountriesTrading Scheme (DCTS), effective from June 19, 2023, pose additional challengesfor Vietnamese exports. DCTS, being one of the most generous preferentialschemes globally, offers duty-free and quota-free trade for Least DevelopedCountries (LDCs) and 85% of eligible goods for Low and Middle-Income Countries(LMICs).

According to Cuong, changes in the UK's trade policies will makeit challenging for Vietnamese exports to compete in the UK market due to strictrequirements and regulations, intensifying competition with goods from othercountries.

Additionally, the tightening of regulations, the impact of theUK's anti-deforestation and forest degradation bill on wood and agriculturalexports, and the rising popularity of specialised diets (vegan, gluten-free,sugar-free) contribute to the complexity and competitiveness of Vietnameseexports to the UK.

In light of these circumstances, Cuong emphasised the importanceof supporting businesses in effectively leveraging the UKVFTA. The VietnamTrade Office in the UK is actively establishing networks with the Britishbusiness community and Vietnamese enterprises in the UK to facilitatepartnerships. It provides updated information on quality standards, UK importregulations, and actively promotes market opportunities through variouschannels, including seminars and online workshops.

The trade office is also actively collaborating with the relevantagencies to organise online seminars, facilitate connections with experts andBritish traders in various sectors, and encourages Vietnamese businesses toparticipate in exhibitions and trade fairs while actively engaging with the UK’ssupermarket systems./.