Top Story of the Week: Port in Kampot to turn province into regional trade hub
Export to Vietnam climbed more than 57 per cent year on year in the first quarter of 2012 as farmers looked for alternative destinations for products that went to Thailand last year.
The primarily agricultural exports to Cambodia’s eastern neighbour were worth US$201.5 million, up from $127.7 million between January and March last year, data from the Vietnam Trade Office showed. A shrinkage in orders from Thailand this year had sent the Kingdom’s farmers looking for new markets, many of which were found in Vietnam, Chan Nora, Secretary of State at the Ministry of Commerce, said yesterday.
The fragile state of Europe’s economies and the slowdown in the United States remain concerns for Cambodia and the ASEAN bloc, as both are key export markets for countries in the region. Post reporter May Kunmakara spoke with International Monetary Fund deputy managing director Naoyuki Shinohara in Washington, DC last week about the Kingdom’s prospects for weathering the storm.
What are the IMF’s prospects for the Cambodian economy?
I think this year and next, Cambodia’s economy should expect solid growth. We’re expecting some negative impacts, especially from Europe, to slow exports. So GDP growth should be [more than] six per cent.
Government officials have joined forces with Japanese experts to formulate a new plan for economic diversity in Cambodia.
Foreign direct investment in Cambodian industry has largely gone to garment manufacturing during the past 10 years, putting the country at risk of economic shock in the event of continued financial crisis in the West.
The Cambodian government must raise its tax revenue intake if it is to stay on a sustainable path toward development, International Monetary Fund officials said in Washington during the fund’s 2012 Spring Meetings last week. Tax collection is low when compared to the country’s gross domestic product, Olaf Unteroberdoerster, senior economist at the IMF’s Asia and Pacific department, said. “It will be necessary to raise the revenue performance of the government so that expenditure can be financed,” he said.
Cambodia's total trade climbed 19 per cent year-on-year in the first quarter, according to the Ministry of Commerce, with a deficit driven by the Kingdom’s reliance on key imports.
Total trade for the first three months of 2012 reached US$3.2 billion, up from $2.7 billion a year ago.
Imports, however, comprised $1.8 billion, or 56 per cent, of the total, as Cambodian markets continued to demand fuel, raw materials for the all-important garments sector and construction materials.
While there’s no doubt oil is present in the overlapping layers of ancient meandering riverbeds now located under 70 meters of ocean off Cambodia’s southern coast, the question is what production rates and quantity the oil reservoirs are capable of, according to Steve Glick, President, Chevron Overseas (Cambodia) Petroleum Limited. “We’re taking a measured and methodical approach to making this project happen, though we’re very optimistic we’ll get the first platform underway, and that will determine the production and expansion opportunities for the project,” Glick said in an exclusive interview last Friday with The Phnom Penh Post.
Cambodian and Southeast Asian banks have been successful in avoiding euro zone contagion, International Monetary Fund officials have said. Local banks throughout the region have stepped into roles that would have been covered by European banks, effectively deleveraging Southeast Asia from crisis, José Viñals, financial counsellor and director of the IMF’s Monetary and Capital Markets, said recently during the IMF’s spring meetings in Washington, DC.
The Cambodia Securities Exchange has seen a sharp decrease in action this week, with trading volume yesterday falling to 3,453 shares, down nearly 100 per cent from Monday.
Despite the drop, which was accompanied by a strong shift from institutional to retail investors, experts have stressed the time and patience required for a fledgling market – one with a single stock traded – to find its feet.
Food & Agriculture
Agricultural experts are urging Cambodian rice growers to choose seeds that can withstand drought and submersion in deep water in an attempt to make the country’s rice industry more competitive.
Awareness of rice-seed selection was limited among farmers in the Kingdom, despite the importance of the issue, Yang Saing Koma, president of the agricultural association CEDAC, said.
Cambodia’s largest Information Technologies and Telecommunications exhibition kicked off here Thursday to reflect progress in the sector of recent years, Xinhua news agency reported.
Some 150 exhibitors ranging from mobile and fixed phone operators to internet service providers and IT companies have had their products and services displayed at the 4-day event held at the capital’s Diamond Island Center
Mobile payment company Wing was in talks on partnering with a US technology firm that plans to assemble Android tablets in Cambodia, in what could be another step away from the country’s staple manufactured good – garments. Although a final partnership agreement had yet to made with Wing, prospects for Cambodia’s first electronics assembly factory “looked very positive”, Wing chief executive Ian Watson said yesterday. “We’re looking for additional ways to compliment our mobile money system,” he said, adding that Wing would not market the devices.
Kampot Port Co will break ground on a Kampot port in September, company officials said yesterday.
The port will be an important part of a long-delayed Kampot Special Economic Zone (KSEZ), which is hoped to revitalise trade and commerce in the province.
Vinh Huor, president of the KSEZ, said with the completion of the port, which is expected to take about 18 months, Kampot could become a transit hub for much of the country’s exports. He also downplayed one of the province’s current leading industry: tourism.
Cambodia has called for an immediate halt to the construction of the Xayaburi dam in an official protest note to Laos, officials said in a statement last week, as opposition to the hydropower project gained momentum in Thailand.
Lim Kean Hor, Cambodia's water resources minister and its representative to the Mekong River Commission (MRC), an intergovernmental body of four countries that share the river, demanded in a letter to his Lao counterpart Noulinh Sinbandhit that construction on the dam be suspended pending an environmental impact assessment.
A judge in Cambodia's Khmer Rouge war crimes trial should be disqualified, defence teams said, after a misfired email stirred accusations she had 'inappropriate' access to a prosecutor.
Judge Silvia Cartwright and prosecutor Andrew Cayley were last month warned by the UN-backed court's highest body that their trial management meetings could give the appearance they had privileged access to each other. But the pair apparently continued to talk privately, according to an email meant for Cayley which the New Zealand judge accidentally sent to the entire court staff on Wednesday.
Thai military officials agreed yesterday to halt construction of a Buddhist statue near the border after talks with their Cambodian counterparts, officials reported yesterday.
Lieutenant Colonel Chit Ly, police commander of Battalion 815 at the border, said Cambodian and Thai officials held negotiations for half an hour yesterday at the government’s behest. On Monday, Cambodian border protection units noticed the statue under construction while patrolling the border in Banteay Meanchey province’s Malai district.
Authorities are investigating the death of a 31-year-old Cambodian man who was gunned down near the Thai-Cambodian border by Thai soldiers early yesterday morning, a border official said.
Pich Vanna, deputy chief of the Cambodian-Thai Border Relations Office, said the shooting occurred in the Thai border province of Sa Kaeo. “Sam Ream, 31, a worker, was shot dead at 3am and his body is now being kept at the hospital in Sa Kaeo province,” he said.
Cambodian land protest blocked by police; 5 hurt, Bloomberg Business News, May 2
Witnesses said Cambodian riot police hit and kicked protesters as they marched in the capital Wednesday to demand compensation for being evicted from their homes to make way for a luxury development. At least five protesters were injured, all of them women. Police in Phnom Penh blocked about 100 protesters from marching to the local offices of the World Bank and the European Union.
International visitor arrival numbers to Cambodia are on the increase with the country reporting a 28 percent increase during the first quarter of this year compared to the same period last year.
According to recent statistics Cambodia welcomed over 995,000 foreign visitors during the three month period, up from 778,467 the year before, with Vietnamese visitors representing 18 percent of the market. Ministry of Tourism general director Mr Tith Chantha attributed the growth from the Vietnamese market to the nation’s proximity.
The city of Lowell, Mass., officially coronated Cambodia Town earlier this month. City officials hope the designation, which marks a section of the city where many Cambodian businesses are, will bring an improvement to people’s lives.
For residents like Chhun Vanndeth, a 23-year-old fishmonger at the city’s Ocean Garden Market, an improved economy would be welcome. He, like others here, says he thinks the designation could make a difference.