By Greg Hands MP-UK Minister of State for Trade Policy
The UK has a deep and robust economic relationship with Southeast Asia. Over the last 10 years, UK-ASEAN trade has grown by almost 70 per cent to just under £42 billion ($55.7 billion). In 2019 alone, trade in goods and services rose by more than 10 per cent. The UK is also one of the top 10 investors in ASEAN, supporting countless jobs, companies, and communities.
The UK is committed to championing free and fair trade and we are looking to work with countries with like-minded trade values. ASEAN is influential in the Indo-Pacific and the UK’s engagement with these countries will help us pivot towards this dynamic area of the world.
This year, COVID-19 has presented the world with huge economic challenges that will have lasting impact. According to a trade and development report through the UN on September 22, trade may shrink by around one-fifth this year, foreign direct investment will increase 40 per cent, and remittances will drop by more than $100 billion.
During this time, it is crucial that we continue to work together to promote closer economic cooperation and mutual benefits of free trade, which are key to economic recovery and future growth.
This year has been a significant one in the UK-ASEAN relationship. In June, the UK applied to remain a dialogue partner of ASEAN, reflecting our deep and enduring commitment to the region. If achieved, the status will enable the UK and ASEAN to foster deeper links in a number of areas, including trade.
In August I joined UK Secretary of State for International Trade, Liz Truss, when she co-hosted the first virtual UK-ASEAN Economic Dialogue with Tran Tuan Anh, Vietnam’s Minister of Trade and Industry. Truss reaffirmed our support for ASEAN’s economic ambitions and commitment to strengthening the region’s resilience against the impact of COVID-19.
The ASEAN region is at the heart of rapid digital adoption and transformation in lifestyle and business. Southeast Asia’s internet economy alone grew to $100 billion in 2019 and is expected to more than triple in size by 2025.
During the UK-ASEAN Economic Dialogue in August, we agreed that nurturing digital innovation is an important area of ASEAN-UK economic collaboration. UK companies already sense a large opportunity in this region and there are over 215 UK tech companies and six tech unicorns in Southeast Asia.
The business forum that I attended over a week ago is a key pillar of the UK’s engagement with this year’s ASEAN Business and Investment Summit hosted in Hanoi. It is also a key step on the paving the way to a digital ASEAN. Passionate digital business leaders shared their thoughts on how digital innovation, fintech, and UK-ASEAN collaboration can enable Southeast Asia to thrive in a post-pandemic world.
Secretary of State Truss highlighted the importance of technology and the future of work to an audience of ASEAN leaders and partners, and key business representatives at the ASEAN Business and Investment Summit on November 13. Connections between the UK and ASEAN will be key in helping bridge the digital skills gap, and the UK looks forward to developing the partnership further in upskilling and reskilling as it seeks to maximise the benefits of digital innovation.
We have a number of initiatives together that deepen our digital partnerships through the Asia Pacific Digital Trade Network. In addition, our new UK-ASEAN Digital Business Challenge explores how tech-minded micro, small, and medium-sized enterprises can deliver solutions to tough business challenges.
The UK-Southeast Asia FinTech Series will also support British fintechs that are expanding in Southeast Asia as they forge strong business partnerships in the region.
This year has presented challenges to the world, but the activities that the UK has supported with ASEAN have filled me with hope, and the UK government is committed to continuing to support the region.
This year is the 10th anniversary of our strategic partnership with Vietnam. Over a week ago, I participated in a virtual signing ceremony of a letter of UK-Vietnam intent with Deputy Minister of Industry and Trade Tran Quoc Khanh, to work together to establish Vietnam’s National Trade Repository (NTR). Vietnam, as this year’s ASEAN chair, has committed to establish an NTR – an online portal to the laws and procedures applicable to trade with Vietnam. Transparency of the terms of trading with Vietnam will support British businesses looking to export their goods and services there. The NTR will feed into the overarching ASEAN Trade Repository, providing transparency of the terms of trading with the region.
Furthermore, the UK’s support for Vietnam’s NTR, through the Prosperity Fund Global Trade Programme, will help ensure the ASEAN Trade Repository captures the terms of trading with all ASEAN member states. Alongside other nations, the UK is pursuing a closer long-term trading relationship with Vietnam and we are working closely together to transition the EU-Vietnam Free Trade Agreement into a bilateral UK-Vietnam one.