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At the UKVFTA – Green and Fair Trade Vietnam seminar co-organized by the Department for Industry and Trade and the Embassy of the United Kingdom of Great Britain and Northern Ireland (UK) in Vietnam, 7 March. Deputy Minister of Industry and Trade Dang Hoang An said green trade is an opportunity to create green goods and services, an opportunity for goods to adapt to ever-higher environmental standards related to environmental protection and climate change.
MANY NEW POSSIBILITIES
According to Vice Minister Dang Hoang An, the UK-Vietnamese Free Trade Agreement (UKVFTA) creates clear advantages for many products with strengths of both countries to penetrate each other’s market, in addition to the extensive tariff reduction plan.
Especially on commitments related to sustainable development, the agreement is also an important framework for cooperative activities on green and fair trade, a major development trend worldwide, to meet World Trade Organization requirements for sustainable development.
to create environmentally friendly goods and services”.
Vietnam is in transition to meet its international commitments on sustainable development, energy conservation and climate change commitments. For companies, this is also an opportunity to create green goods and services, an opportunity for goods to adapt to ever-higher standards of environmental protection and climate change.
Mr Nguyen Canh Cuong, UK Trade Advisor for Vietnam, said Vietnamese companies are seeing new opportunities in green trade with the UK.
Such is the prospect of exporting iron and steel products made by non-carbonization technology. Great Britain is a pioneer in converting steel production to this technology. Vietnamese steel companies are benefiting from the UK-ASEAN cooperation decarbonization program to promote low-energy steel production and reduce emissions.
There is also the possibility of exporting household products and energy-saving appliances such as freezers, washing machines, light bulbs…
Export opportunities for environmentally friendly products, products made from natural materials such as bamboo and cork and insulation products made from recycled materials are in high demand in the UK and UK construction industry.
Another is the ability to export organic food, grown without the use of chemicals. This is a trend that UK consumers are keen to demand, while Vietnamese companies have many benefits to fulfil.
Not only Vietnam has advantages, Mr. Cuong also said British companies also have many opportunities to cooperate with Vietnamese companies in their strengths. Typically renewable energy, sustainable agricultural production, waste management, CO2 reduction in the transport sector… These are the areas where British companies have strengths that can provide technology to Vietnam: South in reducing greenhouse gas emissions, water conservation, waste management, above all plastic waste…
Green finance in particular is the leading theme in green trade development. According to Mr Cuong, some Vietnamese companies are seeking loans from the UK for renewable energy projects. The UK can support Vietnamese companies in sustainable development through green bonds.
UNDERSTAND THE TRANSFORMATION PROCESS
The opportunity to develop eco-friendly commercial products for the UK market is great, but also a challenge for Vietnamese companies.
Harry Rawicz Szczerbo, head of trade and investment at the British Embassy in Vietnam, said Britain is a world leader in developing policies to protect the environment and reduce deflation, emissions and sustainable development, including green and fair trade policies.
With the aim of promoting free trade and turning it into an effective, sustainable and effective vehicle for creating green, sustainable value that benefits both developed and developing countries, the UK is working with partners around the world to Breaking down trade barriers in green ways for goods and services, ensuring free trade helps accelerate the adoption of green technologies around the world.
Since the UK left the European Union, it has developed its own set of rules and rules for trading, in line with the Global Britain policy. In particular, promoting green and fair trade policies in parallel with negotiating, signing and implementing a range of trade agreements with partners around the world, including UKVFTA.
Vice Minister Dang Hoang An valued green trade as an opportunity to create green goods and services, an opportunity for goods to conform to ever-higher standards of environmental protection and to combat climate change. This is also the “green criterion” for exports to the British market.
However, Deputy Minister An noted that the process to reach the goal of carbon neutrality will shift the comparative export advantages from labor and energy-intensive sectors to those applying advanced technologies. This awareness is very important, Vietnamese companies must clearly understand this issue.
According to Ms. Nguyen Khanh Ngoc, deputy director of the Europe-America Market Department (Ministry of Industry and Trade), Vietnamese goods will have to meet new environmental standards in the coming period. Vietnamese companies need to recognize the green trend, innovate technology, improve capacity and move towards green production. Pursuing the strategy of greening products will help customers in foreign markets develop more sympathy for companies’ products and create a competitive advantage.
Green Credit is an initiative and mechanism to encourage green investment in the UK. Vietnamese companies wishing to access credit from mutual funds and UK banks must meet a set of green criteria before they are given priority credit or loan guarantees.
“Vietnamese companies must be aware of and understand these standards, and the plan must convincingly demonstrate that the project will apply technologies to reduce environmental emissions,” Mr. Cuong said.
The British business representative added that Vietnam must meet its commitments with concrete figures. It is necessary to have a specific plan program to make investors feel attractive. In addition to the stability of the legal framework and politics, investors can rest assured to invest without regrets.
The Free Trade Agreement between Vietnam and the United Kingdom of Great Britain and Northern Ireland (UKVFTA) officially came into force on May 1, 2021.
In terms of trade in goods, the UK has committed to eliminating 85.6% of the tariff lines for Vietnamese goods once the agreement comes into force (from 1 January 2021), up to 99.2% of the lines from 1 January 2021 January 2027 and the remaining 0.8% of the customs lines will enjoy tariff quotas (with an import tax within the quota of 0%).
With these commitments, many of Vietnam’s strong products such as seafood, textiles, electronic components, furniture, coffee, rice, fruit, etc. will have advantages when approaching the UK market in the context of the UK market, which many countries did not yet have a free trade agreement with the UK in anticipation of the wave of shifts in demand due to the green and sustainable development trend in the UK.
In 2022, total two-way trade revenue for the full year will increase by 3.3%. Many of Vietnam’s important export products had good growth, such as: coffee (up 61%); Precious stones, precious metals and products (up 56%); toys, sports equipment and parts (up 59%); shoes of all kinds (plus 40%); Textiles (up 36%); electrical wires and cables (up 30%); electronic products and components (up 28%); other machinery, equipment, tools and spare parts (up 37%), plus all types of phones and components still generated over $1 billion in sales.
In the opposite direction, a number of export products with the UK’s strengths continued to generate strong sales, such as: B.: Pharmaceuticals ($81.9 million); other machinery, equipment, tools and parts ($184 million); CBU cars of all types (28.5%); as well as many industries with stable growth rates such as: chemical products (up 3.5%), plastic products (up 28.3%), seafood (23.8%).
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