The relationship between Việt Nam and the UK has been vibrant across the board this year, with a flurry of activities that underscore the latter’s status as one of Việt Nam's important markets. Việt Nam News correspondent Thu Ngân speaks with Alex Smith, the British consul general in HCM City and trade director for Việt Nam, about bilateral trade relations, prospects and initiatives.

Alex Smith, British consul general in HCM City and trade director for Việt Nam. – Photo courtesy of British Consul General in HCM City

Could you give us an overview of what has been happening in the ties between Việt Nam and the UK this year? 

The UK and Việt Nam have had many achievements across a range of sectors in 2024. 

In the first four months of 2024 UK- Việt Nam trade in goods showed a 9 per cent increase, with increasing demand for pharmaceuticals. 

In March, the UK sent a delegation of top fintech and tech companies to Việt Nam to participate in The UK - Southeast Asia Tech Week held in HCM City, where we facilitated more than 100 business matching meetings and networking sessions, took UK tech firms on site visits to Việt Nam’s largest tech unicorns/conglomerates (like FPT, VNG), resulting in a number of promising business leads. 

In April, a delegation from the HCM City Department of Health paid a visit to Oxford, Liverpool and London in the UK where they engaged in conversations and exchanged knowledge on primary care system, nurturing medical education, fostering medical innovation, and commercialisation with leading experts.

In June, the British embassy invited a Vietnamese technology delegation of 24 government and corporate leaders to attend London Tech Week and meet with leading UK technology conglomerates, banks, industry experts and local vendors.

After the trip, many contact points were shared for follow-up meetings to discuss detailed proposals and potential pilot programmes for the sector in Việt Nam. 

In July, British railway design firm Crossrail signed an MOU with the Management Authority for Urban Railways (MAUR) in HCM City to help the city build the MRT and provide advisory services on Building Information Modelling application and digital transformation. 

At the end of July, Vietjet Air signed a US$7.4 billion trade deal with Airbus and Rolls-Royce, marking our UK-Việt Nam relationship with a success trade story combining aeroplane and green energy. 

Education is a shared success story in the UK and Việt Nam. Since the beginning of the year the British Council opened a new teaching centre and Oxford University Press’s curriculum has entered new schools in Việt Nam. 

Have there been any shifts in key trade products during this period, and if yes, why? 

Our focus has been to accompany what the country needs. While education, healthcare and finance have always been at the forefront of our trade relationship, climate change, green energy and technology have never been more critical areas to develop. Just last week our foreign secretary, David Lammy, announced that action on the climate and nature crisis will be central in all UK’s foreign relationship. 

Some of our trade priorities in Việt Nam include assisting Việt Nam in building an international financial centre in HCM City and promote bilateral financial services trade. 

The UK is working with TheCityUK to help Việt Nam develop an international financial centre (IFC). As Việt Nam continues with its ambitious economic reform programme, an IFC would not only further encourage FDI, but could also create a system of enhanced access to the Vietnamese market for IFC members. 

The UK is keen to support Việt Nam and HCM City with developing the financial services industry through capacity building, collaboration and sharing of best practices.

We also want to promote financial services trading between the two countries. 

In terms of climate change, Việt Nam is regarded as a regional leader in sustainable development and as a go-to destination for green investment as demand for energy has increased by 10 per cent per year for the past 20 years. 

It is estimated that Việt Nam needs to invest $203 million between 2021 and 2030 and a further $615 million between 2031 and 2050 to meet capacity demands. 

The UK is here to help Việt Nam achieve its net-zero goals. In December 2022 the UK, the European Union, the United States, Japan, Germany, France, Italy, Canada, Denmark, and Norway all contributed to a financial package of $15.5 billion through the Just Energy Transition Partnership (JETP), which will help the country deliver its ‘net zero’ commitment by 2050. In addition to funding, the UK also has experts and world-leading businesses ready to support Việt Nam in their next steps through the green transition in sectors such as offshore wind. 

In the education sector, Việt Nam is one of the five countries prioritised by the UK under its International Education Strategy, with more than 14,000 Vietnamese students coming to the UK every year. On the other hand, the UK has more transnational education partnerships than any other international partner in Việt Nam, allowing more Vietnamese students to access UK education. 

What I think also needs to be put on the top of our minds is our micro, small and medium-sized enterprises (MSMEs) community. This community makes up 99 per cent of our businesses, both in Việt Nam and the UK.

Since 2021 staff at the British consulate general have supported 350 new small and medium sized British businesses interested in exporting to Việt Nam, bringing new foods and beverages, retail goods, education and training, and tech solutions to Việt Nam. I am keen to work closely with Việt Nam to help our MSMEs understand and be able to access the range of support the UK and Việt Nam have agreed on to boost trade. 

The recent visit by the mayor of London reaffirmed UK’s commitment to promoting trade between the two countries for mutual growth.

A UK delegation on a visit to Việt Nam. The UK looks forward to further deepening bilateral relations for a better future for the people of the two countries.

Việt Nam’s National Assembly ratified the UK’s accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership in June. How do you see this and its impact on trade between Việt Nam and the UK? 

The UK is the 15th largest foreign investor in Việt Nam, with bilateral trade between the two countries doubling in the last 10 years and hitting £6 billion ($8 billion) by 2024. This was largely possible because of the UK-Việt Nam FTA which came into force in 2021 and accelerated trade, bringing more choices to consumers in both countries. 

For example, in 2023 the UK’s food and drink exports to Việt Nam topped £126 million, an increase of 97 per cent from 2019, showing Việt Nam’s appetite for British whisky, frozen seafood and confectionary. In turn, Việt Nam’s agricultural products are now on shelves in UK supermarkets. This December the CPTPP will come into force in Việt Nam. I am optimistic that the CPTPP will boost UK-Việt Nam trade. 

These agreements will make it even easier for UK and Việt Nam businesses to expand operations and increase exports in agriculture, healthcare, financial services, and e-commerce. 

Businesses will not only benefit from reduced trade barriers but also have a stable and predictable trading environment. This will enable firms to compete globally and join hands for trade across the Indo-Pacific, which includes some of the world’s most dynamic and rapidly growing markets. 

In the remaining months of this year many British activities will take place in Việt Nam with several delegations visiting the country. Could you tell us about these events, and what expectations does the UK have from these activities? 

Looking ahead, the UK is planning multiple events to bring our business communities together. We will be present at the Green Economy Forum and Exhibition in October and bring a delegation of health experts to HCM City in November.

At the end of March the UK’s Southeast Asia Tech Week will launch in HCM City, with the UK Government bringing a delegation of exceptional technology companies to engage with Vietnamese partners and create more opportunities for trade between the rapidly growing digital and technology sectors in the UK and Việt Nam. Next year will also mark the 15th anniversary of the UK-Việt Nam Strategic Partnership. 

In the next four years I look forward to further deepening relations between our two countries for a better future for our peoples. – VNS