Containers are loaded on a ship at Saigon port in Ho Chi Minh city, Vietnam, May 3, 2020. (HAU DINH / AP)

Vietnam and the UK concluded a free-trade agreement that will see 99 percent of tariffs between the two countries eliminated after seven years.

Vietnam will see 114 million pounds (US$151 million) in tariff savings on its exports by the time the deal is fully implemented, the two country’s trade ministers said in a joint statement Friday. The UK stands to save 36 million pounds on its exports.

Vietnam will see 114 million pounds in tariff savings on its exports by the time the deal is fully implemented, the two country’s trade ministers said in a joint statement Friday. The UK stands to save 36 million pounds on its exports

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The sides had been negotiating the agreement since August 2018, Vietnamese Industry and Trade Minister Tran Tuan Anh said. Vietnam’s trade deal with the EU will no longer apply to the UK, which is leaving the common market, after Dec 31, with the new agreement taking effect the following day.

“The UK and Vietnam share a strategic commitment to global trade, and the free flow of capital and investments,” the ministers said in the statement. “The bilateral Free Trade Agreement provides vital continuity for our fast-growing and dynamic trading relationship.”

Continuity Deals

The UK is Vietnam’s third-largest trading partner in Europe. The Southeast Asian nation sent around 4.6 billion pounds worth of goods to the UK last year, while UK businesses sent more than 600 million pounds worth of goods to Vietnam, according to the joint statement.

Bilateral trade was down 15 percent in the first 10 months of this year amid the coronavirus pandemic, according to a posting on Vietnam’s government’s website.

READ MORE: EU seen opening up trade to Vietnam, closing door to Cambodia

Friday’s ceremony comes a day after the UK signed a similar continuity deal with Singapore.

The deals with Singapore and Vietnam not only lock in billions of pounds’ worth of trade, “they also pave the way for new digital partnerships and joining the Trans-Pacific Partnership,” UK International Trade Secretary Liz Truss said in a statement Thursday. “This will play to the UK’s strengths, as we become a hub for tech and digital trade with influence far beyond our shores, defining our role in the world for decades to come. ”