Progress and challenges

The Vietnam-UK Free Trade Agreement (UKVFTA) has given many Vietnamese agricultural products a competitive advantage in the UK market compared to similar products from countries without an FTA with the UK. However, to build a position and compete in this potentially lucrative but demanding market, Vietnamese agricultural products face numerous challenges. Mr. Nguyen Canh Cuong, former Commercial Counselor of Vietnam in the United Kingdom, discussed this issue with the Industry and Trade Newspaper.

Thanks to improved quality and the UKVFTA agreement, Vietnamese agricultural products are gaining an increasingly strong foothold in the UK market. Photo: Phuoc Tuan

Sir, Vietnamese agricultural products have made remarkable progress in accessing international markets in recent years, especially in the United Kingdom. What are your thoughts on these impressive results?

Over the years, Vietnamese agricultural products have made a strong mark on the international market, especially in the UK – one of the most demanding markets in Europe. In the UK market, products such as rice and fruit are now available in major supermarket chains such as Tesco, Sainsbury's, and Asda.

Furthermore, the presence of large agricultural export businesses such as Cuu Long Seafood Import-Export Joint Stock Company with its pangasius and giant freshwater prawn products has opened up many opportunities for Vietnam in the UK market. In 2023, Cuu Long Joint Stock Company achieved revenue of 30 million USD from pangasius exports to the UK, accounting for 10% of the company's total export turnover.

Currently, many key products such as rice, coffee, and tropical fruits (like dragon fruit, mango, and durian) have expanded exports to the UK thanks to improved quality and compliance with international standards. This is particularly a significant effort by businesses and relevant authorities, as well as a benefit from the UKVFTA agreement since its entry into force in May 2021.

Significantly, before the UKVFTA, many Vietnamese agricultural products were virtually uncompetitive with those from Thailand, Malaysia, Indonesia, South Africa, or India. However, the UKVFTA has now given many Vietnamese agricultural products a competitive advantage in the UK market compared to similar products from countries that do not have an FTA with the UK.

Mr. Nguyen Canh Cuong – Former Commercial Counselor of Vietnam in the United Kingdom

Looking ahead, in order to penetrate deeper into the UK market and gain an even stronger position, what challenges do you think Vietnamese agricultural products are facing?

Although the UKVFTA agreement has brought tariff advantages, ensuring quality and compliance with EU food safety and environmental regulations poses a significant challenge for Vietnamese agricultural products. Therefore, sustainable development and meeting EU food safety standards are crucial factors in helping Vietnamese agricultural products maintain their market share in the UK.

While a large market, the UK also demands high quality standards for agricultural products and vegetables and is highly competitive. Therefore, Vietnamese agricultural products need to demonstrate sustainability and transparency in their supply chains to compete with other countries such as Thailand and India. In this regard, Cuu Long Joint Stock Company has leveraged the UKVFTA to increase exports of pangasius and shrimp to the UK, benefiting from preferential tax rates and meeting the standards of this market.

At the same time, strong competition from countries such as Thailand, Peru, and Colombia is one of the major bottlenecks for Vietnamese agricultural products that businesses need to address. Therefore, to cope with this challenge, businesses need to increase the application of modern technologies such as AI, IoT, and big data analytics to improve production efficiency and reduce costs.

Based on his experience as a trade attaché for many years, what solutions can he suggest to help promote Vietnamese agricultural products more widely in the UK market?

To succeed in the UK market, in addition to ensuring a stable supply in both quantity and quality, Vietnamese businesses need to promote their brands effectively. Therefore, businesses should focus on improving their product promotion websites with content, language, and images that meet international standards. The website should provide complete product information, food safety certifications, and professional images, making it easy for UK importers to find information and assess product quality before deciding to cooperate.

Furthermore, the pioneering role of large enterprises such as SS Food Vietnam and Cuu Long Joint Stock Company in promoting and developing brands in the UK is crucial. SS Food Vietnam has maintained its number one position in the UK shrimp market, accounting for 24% of the country's total shrimp imports. These businesses not only build strong distribution networks but also create opportunities for small and medium-sized enterprises.

Therefore, a combination of website improvements, digital technology adoption, sustainable development, and collaboration with strategic partners will help Vietnamese agricultural products increase their chances of entering the UK market and achieve long-term success.

Furthermore, in order to understand the needs and preferences of British consumers, what specific measures do you think Vietnamese businesses need to take?

Businesses need to conduct market research through reports, consumer surveys, and trends in agricultural product consumption in the UK. This may include using professional market research services or consulting reports from reputable organizations such as Mintel, Euromonitor, or Nielsen. These reports provide detailed insights into consumer trends, changes in food preferences, and potential customer segments.

Participate in international trade fairs. Specifically, participating in international trade events and fairs such as the International Food & Drink Event (IFE) and The London Produce Show will give Vietnamese businesses the opportunity to meet directly with distributors, retailers, and importers in the UK. Through these events, businesses can grasp market feedback and the latest trends in agricultural products.

British consumers are increasingly interested in sustainable, organic, and traceable products. Therefore, businesses need to meet these requirements by adopting organic certifications, GlobalGAP, or other international food safety standards. This not only enhances consumer trust but also creates a competitive advantage over other countries.

Online tools like Google Trends, Facebook Insights, and Amazon Best Sellers can provide valuable information about search trends, preferences, and consumer behavior in the UK. By monitoring these tools, businesses can gain a better understanding of the types of products British consumers are looking for and adjust their export strategies accordingly.

Furthermore, it involves connecting with distribution partners and the Vietnamese community in the UK. Collaborating with Asian food distribution companies such as Longdan, Viet Grocer, and Wing Yip can help businesses easily reach Asian consumers, especially the Vietnamese community in the UK. This is a crucial market with a significant impact on the demand for agricultural products from Vietnam.

Thank you, sir!

Source: https://congthuong.vn/nong-san-viet-nam-chinh-phuc-thi-truong-anh-buoc-tien-va-thach-thuc-347181.html