A closer look at recent developments between the two countries, both before and during the coronavirus pandemic.
Last week, two Vietnamese children donated 20,000 facemasks to help the United Kingdom fight the coronavirus pandemic. The British Embassy staff in Hanoi sent the masks, along with 100 stranded British nationals, on a commercial flight back to the UK. With the growing number of deaths in the UK and shortage of personal protective equipment (PPE) for health workers, these gifts are valuable; they further underscore strengthened relations between the UK and Vietnam.
As covered at The Diplomat previously, since 2010 the relationship between Vietnam and the United Kingdom has been elevated to a strategic partnership. Tran Ngoc An, Vietnam’s Ambassador to the UK, has strongly contributed to the development of Vietnam’s diplomacy with the UK.
In a July 2019 interview with a Vietnamese newspaper, he said that cooperation between Vietnam and the United Kingdom has developed very quickly and deeply in term of trade and investment. Trade turnover between the two countries has increased two-fold. The import-export turnover between Vietnam and the United Kingdom was $ 6.7 billion, mostly Vietnamese exports to the UK to the tune of $5.7 billion and the remainder imports from the UK to Vietnam. In terms of foreign direct investment (FDI), the UK is ranked 15th among countries investing in Vietnam.
In 2016, David Cameron was the first British prime minister to visit Vietnam, where he aimed to boost trade and tackle human trafficking issues. It marked significant progress in the relationship between the two countries. In his memoir, For The Record, Cameron said he was excited to be back in the country when he had been a tourist in the mid-1990s. He said he saw Vietnam’s significant economic transformation and remarked that it had a vibrant society with a young and a growing middle class. According to a PwC report it is forecasted that the number of middle class Vietnamese will reach 44 million by 2020, and 95 million by 2030. That development will transform lifestyle in Vietnamese society and increase consumer spending, especially of higher value-added products.
The UK’s departure from the European Union provides an opportunity for British investors to look beyond their traditional continental markets. With over 97 million people and wide connections to most major economies in the world through 14 bilateral foreign trade agreements, Vietnam is a popular choice for the UK to do business. According to the UK Department for International Trade, there are opportunities for UK companies to invest in four main sectors in Vietnam: education, energy, infrastructure and healthcare.
In the 45 years since the Vietnam War ended, the Vietnam-UK bilateral relationship has improved significantly from both sides.
In October 2019, the 11th session of the UK-Vietnam Joint Economic and Trade Commission (JETCO) demonstrated that the UK is the largest investor in Vietnam’s education sector and the country ranked third in Vietnam’s total import and export turnover with EU countries, while Vietnam ranked 25 out of 233 countries exporting to the UK. Vietnam ranked second (after Thailand) in terms of exports to the UK in ASEAN, accounting for 0.8 percent of total import turnover. In the first eight months of 2019, bilateral trade relations reached $4.53 billion.
Throughout 2019, the two countries continued to enhance their relationship. Mark Field, the minister of state for Asia and the Pacific at the UK’s Foreign & Commonwealth Office, visited Vietnam in early 2019. While in Vietnam, he discussed different ways to enhance the relationship with the Deputy Foreign Minister Bui Thanh Son, covering areas of politics, security, economics, combating wildlife trafficking and corruption, human rights and other areas of collaboration. He also addressed corporate governance, opportunities and future trading, and anti-corruption with representatives from civil society.
On July 4, 2019, Vietnam’s Finance Minister visited the UK. Speaking in front of more than 200 foreign investors at Vietnam Investment Promotion Conference, Minister Dinh Tien Dung affirmed that the UK is an important economic partner for Vietnam and Vietnam is a vital economic partner for the UK in Southeast Asia. Vietnam has demonstrated strong economic growth and maintained a stable political environment. The Vietnamese government implemented economic restructuring, the equalization of state-owned enterprises, and sustainable development of the stock market, opening for UK investors come to do business in Vietnam.
Meanwhile, Vietnam has expanded its cooperation with regional and international players. Vietnam is the chair of the ASEAN community and has a nonpermanent seat in the UN Security Council in 2020.
Vietnam’s broader diplomacy has become particularly noticeable in the recent crisis, as the country donated 550,000 face masks to five European countries, including the UK. The aim was to support these countries in containing the coronavirus pandemic. Last week, it was announced that Vietnam was cooperating with the UK in clinical research to treat coronavirus with chloroquine. Vietnamese experts are working with Oxford University in order to conduct clinical trials to find new treatments for COVID-19.
Vietnam, in this way, is building on already strengthening relations with the UK with recent endeavors in light of the coronavirus pandemic.