The deal, which will for Britain replace the existing EU-Vietnam Free Trade Agreement (EVFTA), will ensure Britain does not lose access to preferential tariffs in one of the fastest growing and most open economies in Asia.
“Today, UK International Trade Secretary Liz Truss and Vietnam Minister of Industry and Trade Tran Tuan Anh concluded the UK-Vietnam Free Trade Agreement,” the embassy said in a statement.
“This will be a further boost to UK-Vietnam bilateral trade, which has tripled between 2010 and 2019 to 5.7 billion pounds ($7.58 billion)”.
It was not clear when the final deal, which will come into effect on Jan. 1 next year, would be signed.
The EVFTA came into effect in August and will cut or eliminate 99% of tariffs on goods traded between Vietnam and the EU.
Since leaving the EU in January, Britain is striking out alone and negotiating new trade deals with countries to replace those the bloc had negotiated.
On Thursday, Truss also signed a free trade deal with her Singaporean counterpart, as EU and British leaders tried to seal a new trade pact and avert what some fear will be a chaotic end to the five-year Brexit process.
Britain has expressed its desire to join the 11-country Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), that will slash tariffs across much of the Asia-Pacific, welcoming Vietnam’s support for that goal in September.
A joint statement released by Britain and Vietnam on Friday described the deal between the two countries as a “key step” towards Britain’s entry into the CPTPP.
Britain is Vietnam’s second largest export market in Europe, according to Vietnam’s trade ministry.
Vietnam’s key exports to Britain include garments, seafood and wooden furniture. Its main British imports are pharmaceutical products and manufacturing equipment.