Impact of the EU-Vietnam Free Trade Agreement on the UK Economy

The Project at A Glance

The European Union, on behalf of its member states, including the UK (at the time), negotiated the EU-Vietnam Free Trade Agreement (EVFTA) to assist with the development of Vietnam and provide additional avenues for trade and investment. Whilst the text of the agreement had been agreed, the agreement itself had not been signed nor ratified at the time this project was implemented.

International Economics, with funding from the Department of International Trade, conducted a study to evaluate the impact of the EU-Vietnam Free Trade Agreement on the UK economy.

What We Found

The project’s overall objective was to provide details of the impact that the EVFTA will have on UK GDP, consumer welfare, bilateral trade and a range of other variables as well as the sectors that will be most heavily impacted. International Economics also provided an evidence-based policy analysis paper which included summary of the key findings, a description of the features of the modelled agreement and a summary of the key modelling assumptions, along with justifications and methodologies where appropriate.

Our Strategy and Impact

The team at International Economics elaborated a Computable General Equilibrium (CGE) model which provided three specific outputs: CGE outputs from analysis of the EVFTA on the UK economy, ad-valorem equivalents of non-tariff measures applied for Vietnam and UK and ad-valorem equivalents reductions incorporated into the baseline. The outputs from this project were used to feed into the Department of International Trade’s own impact assessment which would be used to inform the British Parliament when the EVFTA would be at the signature stage.

Our Core Solutions

Governments, international donors, and the private sector face many important questions on the expected outputs and impact before, during and after the implementation of their projects. Applying our analysis and research knowledge, we help our clients maximise efficiency and improve their development objectives. Through the lessons learnt and the feedback mechanisms we implement in our monitoring, evaluation, and learning (MEL) processes, we support institutional strengthening and the re-alignment of resources to ensure the sustainability and maximum impact of projects, helping our clients make well-informed strategic decisions.