| National Affairs
Draft Statistics Law Approved by Assembly Cambodia Daily 15th Oct 2015
A new law on the collection and dissemination of statistical data is set to be put to a vote at the National Assembly later this year after being approved by a parliamentary commission Wednesday. “This law is being created with the clear goal of allowing us to get plentiful data and information to serve researchers and policy planners in various sectors and allow them to prepare their strategies based on accurate analysis,” Planning Minister Chhay Thorn told reporters after a meeting of the Assembly’s planning commission. Pol Ham, a CNRP lawmaker and the chairman of the commission, said he expected the law to be debated during the next general session of the National Assembly, which begins on Tuesday. If passed, the law would replace a 2005 law on statistics, which did not make sufficient provisions for the government funding of statistical data collection, according to Hang Lina, director general of the National Institute of Statistics. Because of this, she said, data collectors did not have adequate financial incentives to do their jobs well. “Before, we didn’t have enough funds,” she said. “This meant that officials did not have encouragement to collect the data thoroughly.”
TPP puts Cambodia’s trade, investment in the spotlight PPP 7th Oct 2015
The conclusion of the Trans-Pacific Partnership agreement has industry insiders in Cambodia split over whether or not the new pact will limit the Kingdom’s trade growth potential in the US market and see future investments diverted to Vietnam. Ending a long-drawn negotiation process that lasted five years, the 12 members of the Trans-Pacific Partnership (TPP) – which includes the US, Japan, Canada and Vietnam – agreed on a framework Monday that will liberalise trade between the members and “foster inclusive development and promote innovation across the Asia-Pacific region”. Ken Loo, secretary-general of the Garment Manufacturers Association of Cambodia, said that while the agreement was expected, it could eat into the Kingdom’s already dwindling economic competitiveness, which is plagued by rising labour costs and logistical deficiencies. “We’re not competitive, that’s why exports to the US have been declining every year, because we’re losing market share,” he said yesterday. According to Loo, even without the TPP in place, Cambodia is already losing market share in the US. Exports to the US accounted for only 32 per cent of total garment shipments this year, compared with 50 per cent three years ago. The TPP will eliminate most tariffs in the textiles and apparel segment, save a few sensitive products where tariffs will be eased off over a longer time frame. The end of these barriers, Loo said, could swing garment exports in favour of Vietnam and further solidify the Kingdom’s reliance on the European market, which accounted for 42 per cent of exports in 2015.
Trade Deal a ‘Wake-up Call’ for Cambodia Khmer Times 6th Oct 2015
The Commerce Ministry is looking closely into the ramifications of the Trans-Pacific Partnership (TPP) signed by 12 nations on Monday, especially at how it may affect exports, as Cambodia is not included in what is being billed as the world’s largest free-trade market, Commerce Minister Sun Chanthol told Khmer Times yesterday. Mr. Chanthol also said he would not have the details of the agreement, which followed five years of negotiations between 12 Pacific Rim countries, until the end of this year. “The TPP meeting just finished yesterday and the document is secret. I will have the document by the end of the year, but we are already looking into and studying how the TPP will impact our economy,” Mr. Chanthol said. He made the comments in an interview following a speech at CamEd Business School yesterday morning. The minister also said that the government is currently negotiating a Regional Comprehensive Economic Partnership to diversify its export markets beyond their reliance on the United States and European Union. “We are negotiating with China, Japan, Korea, Australia, and New Zealand.” Mr. Chanthol’s comments follow speculation here that the TPP could make Cambodian exports less competitive than those from neighboring countries like Vietnam and Malaysia, which are part of the deal. It could also result in a fall in foreign direct investment (FDI) in Cambodia, executives and economists warn. Spearheaded by Washington, the TPP will cut barriers and establish common standards for 12 countries. These are the United States, Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. Mr. Chanthol told Khmer Times that it was possible Cambodia could still join the TPP. “Cambodia is looking into whether or not it can join TPP,” he said.
PM Warns Cham Over Dangers of New Gov’t Cambodia Daily 15th Oct 2015
Prime Minister Hun Sen used the occasion of the Islamic New Year on Wednesday to warn the country’s Cham Muslims that a change in government could lead to widespread slaughter and persecution of Muslims, like under the Khmer Rouge in the 1970s. In his second recent statement seemingly comparing the opposition CNRP to the Khmer Rouge, Mr. Hun Sen said in a message posted to his personal Facebook page that his government saved the nation’s Cham Muslims, while an unnamed political party might lead them into disaster. “The government has always supported and promoted the rights of religious freedom, rights of equal employments and rights of participation in all forms of social affairs to all Cambodian Muslims in the country,” Mr. Hun Sen wrote in a message in English and Khmer. “We all remember well from the ‘Khmer Rouge’s Propaganda of Revolutionary Changes’ more than 30 years ago, which resulted in an almost complete disappearance of Cambodian Muslims from the country,” he added. “At this moment, all Cambodian Muslim brothers and sisters should again be aware of inciting propaganda from a political party to galvanize the change…similar to the Khmer Rouge’s Propaganda in the past.” Mr. Hun Sen said that the country’s Cham Muslims should look at the destruction that has swept countries like Syria, Iraq and Egypt since the advent of the Arab Spring, which began with small groups protesting for democracy.
Corrupt judiciary putting off investment, businesses say PPP 10th Oct 2015
In the wake of a damning report on the state of Cambodia’s courts, businesses say the quality of the judicial system is affecting decisions on whether to invest in the Kingdom The Kingdom’s judiciary took a lashing last month when the International Bar Association published a report that found Cambodia’s courts to be plagued by corruption, bribery and political influence. The report, titled Justice versus Corruption: Challenges to the Independence of the Judiciary in Cambodia, painted a grim picture of the Kingdom’s judicial functioning and cited a lack of confidence in its operations from both locals and foreigners. Endemic corruption across every sector, including the judiciary, is one of the reasons for Cambodia’s abysmally low “Ease of Doing Business” ranking put out by the World Bank. The annual rankings placed Cambodia 184 out of 189 countries for ease of doing business, with enforcement of legal contracts ranked 178th – reflecting the state of the Kingdom’s court system. The impact on investment is likely significant. Having a “strong and effective” judicial system was one of the key factors incoming investors would base their investment decisions on, said Matthew Rendall, senior partner at Sok Siphana and Associates. “It is not in and of itself necessarily a factor which may cause them to choose not to invest, but it certainly forms part of their considerations when deciding whether or not to invest,” Rendall said. On the issue of enforcing contracts, with the system as it currently stands, foreign investors find it hard to rely on the judiciary because of the lack of “the courts providing reasons for their decision making”, according to Rendall.
Hun Sen: Rainsy No Different Than Pol Pot Cambodia Daily 9th Oct 2015
Prime Minister Hun Sen released a three-page statement Thursday claiming there were “no differences” between what opposition leader Sam Rainsy would do to the country if he won the next election and the destruction Pol Pot wrought during his three years in power. Posted to Mr. Hun Sen’s official Facebook page, and titled “The Most Dangerous Policy,” the statement renewed the prime minister’s warnings that if Mr. Rainsy’s CNRP won the election, class tensions would boil over into full-blown civil war. “If the CNRP wins, they will create a court in order to convict businessmen whom they accuse of doing business illegally,” Mr. Hun Sen wrote. “If they win, they will confiscate property from the rich who do business wrong.” He explained that such a proposal reminded him of a Khmer Rouge policy released in February 1975 to execute the seven top leaders of the Lon Nol regime once the Khmer Rouge came to power.
Staff ‘swamped’ with paperwork PPP 9th Oct 2015
A progressive budgeting policy used by the Education Ministry has overloaded local administrators with paperwork for which they often lack the expertise, according to a new report, which found the system was less efficient in 2014 than the year before. Released by the NGO Forum, and funded by Save the Children, the study analysed the Education Ministry’s program-based budget (PB) for 2014 – about $42.5 million of the total $330 million budget. Though the PB system – which was extended this year to include the entire education budget of $391 million, and that of nine other ministries – had produced “concrete progress” in spending efficiency, it had also increased the bureaucratic burden for those at the bottom, the report found. “It is a good thing to move to program-based budgets, but one not-so-favourable consequence of that is the amount of paperwork that the school level and district level have to meet; they have to produce a lot of reporting both on the expenditure and on the result,” said researcher Pak Kimchoeun. Partially implemented in 2007 to improve efficiency and accountability, the PB system allocates specific sums of cash that can only be spent in certain areas and cannot be rolled over to the next financial year. For education, until 2015, this covered mainly operational costs for schools. Last year, only 82 per cent of the total PB was spent compared to 93 per cent in 2013, the report found.
Experts Question Whether Trans Pacific Partnership Is Right for Cambodia VOA Khmer 9th Oct 2015
Economists and trade experts say Cambodia should consider carefully whether to ever join the Trans Pacific Partnership, a large trade initiative led by the US that so far includes 12 countries. Chan Sophal, director of the Center for Political Studies, told VOA Khmer that the partnership includes a lot of conditions imposed by developed countries, so Cambodia could have a hard time meeting them, and must weigh the costs and benefits of the deal, regardless. “We must have a calculation, make an evaluation, and study and think comprehensively, so that we can get a significant understanding,” he said. “Our country lags behind many countries in Asean in terms of development, and we would have difficulty in meeting different conditions,” he said. “I think that this TPP has political concepts, because it is led by the US, Japan, and other countries that have put a lot of effort in creating a region to do trade broadly, in order to counter different views that would be in favor of China.”
Government’s plan to develop public housing takes on shape PPP 8th Oct 2015
Phnom Penh’s public housing policy, aimed to provide affordable housing for the middle income class and low income class, is expected to boost the construction sector in Cambodia as an increased population and rapid urbanisation is expected to create a demand of more than a million new homes by 2030, according to a draft national policy announced this past year. Through the policy, the government will work with private developers, investors and banks in providing affordable housing for low to middle income families, said Seng Lot, spokesperson for the Ministry of Land Management, Urban Planning and Construction, adding that officials are being trained from a national to sub-national level on the policy, as well as working with international partners to increase support and regulation over the implementation of the policy. “It is possible that the houses would be built on public land by private developers then the houses would be sold at a compromising price to buyers,” he said. In order to assess the needs of the people, which would then determine the timeframe and location of the housing construction, The Department of Housing was created under the Ministry of Land Management, Urban Planning and Construction to collect data and oversee housing projects following the announcement of the policy, Seng said.
Despite Strong Growth, Economy Still Fragile Cambodia Daily 8th Oct 2015
For the past two decades, Cambodia has been among the world’s fastest growing economies emerging from civil war at rates unparalleled by other post-conflict countries. In its latest “World Economic Outlook,” released on Tuesday, the International Monetary Fund again predicted continued strong growth, projecting an annual average rate of 7.2 percent until 2020. This places Cambodia at almost double the global average, and just above average for other emerging and developing economies in Asia.
Cambodia Raises Monthly Minimum Wage to $140 VOA 8th Oct 2015
The Cambodian government said Thursday that the minimum wage for the country’s garment sector – its key export earner and largest industrial employer – will rise to $140 a month. The increase of nearly 10 percent was more than manufacturers wanted but far less than unions were seeking. Thursday’s announcement by the Ministry of Labor that the minimum wage will rise to $140 a month for the garment sector’s 700,000 workers will come into effect in January. The hike in the wage from the previous figure of $128 follows weeks of tough negotiations between the government, manufacturers and unions. Manufacturers group The Garment Manufacturers' Association in Cambodia, or GMAC, which represents about 600 factories that export garments and shoes, said the group accepts the increase despite lobbying for a lower figure. “As entities or corporations operating within this environment we have to abide by the decision of the government," GMAC secretary-general Ken Loo said. "However, we would like to warn or raise to the attention of all stakeholders if we do not have corresponding increase in productivity and efficiency.
Deadline for Wage Negotiations Missed Cambodia Daily 6th Oct 2015
The tripartite Labor Advisory Committee (LAC) on Monday missed its provisional deadline to decide on a new minimum wage for the garment sector, with employers and trade unions making little progress in coming to an agreement. Last month, Labor Minister Ith Sam Heng said he hoped the LAC would agree on a proposal for the garment sector’s new monthly minimum wage—currently set at $128 —by October 5. The Labor Ministry will make a final decision on the matter. On Monday, however, the LAC’s working group—a more inclusive body of government, factory and union representatives charged with proposing a new wage to the committee—was still negotiating, and seemingly far from consensus. Most of the unions stuck to the $163 figure they proposed on Friday, after having come down over the past few weeks from $207. The employers increased their proposal slightly, offering a 3.75-percent raise instead of a 3.5-percent raise. Ken Loo, secretary-general of the Garment Manufacturers Association in Cambodia, said the extra 0.25 percent was related to the National Social Security Fund’s increasing costs.
World Bank Says Cambodia Will Weather China Slowdown Cambodia Daily 6th Oct 2015
The World Bank on Monday stuck to its prediction made in April that the country’s economy would continue to cool off slowly over the next few years and said China’s own slowdown would send only modest ripples through Cambodia. In its six-month update of the economies of East Asia and the Pacific, the Bank said Cambodia’s gross domestic product (GDP) growth would dip from 7.1 percent in 2014 to 6.9 percent this year and next year, and to 6.8 percent by 2017, matching its forecast in April. “We are looking at four main channels of growth in Cambodia, with construction in very good shape, very dynamic—and also real estate booming—while the garment and tourist sectors are losing a little bit of steam,” said Miguel Sanchez Martin, the Bank’s new senior country economist. “Perhaps agriculture is the sector having most difficulties,” he said. “So with that in mind, we are projecting a 6.9 percent growth for 2015…. So this is still very strong growth.” Low rice prices and sluggish growth in yield will keep agriculture output in Cambodia down, the Bank said, while a strengthening U.S. dollar, emerging low-wage competitors and the uncertainty surrounding minimum wage negotiations will limit the rise of garment exports. World Bank country economist Sodeth Ly said the construction sector—now Cambodia’s main economic driver—could also start to cool as the 2018 national election approaches.
Big Ambitions for Model School Program in Cambodia VOA 5th Oct 2015
On a leafy campus near Cambodia’s capital Phnom Penh, a group of 50 schoolchildren are benefiting from a bold educational experiment with a dual aim: to turn out youngsters who can improve the country, and to develop a model program that can be replicated internationally. In 2012 staff from the Liger Learning Center interviewed hundreds of children across Cambodia to find the most promising students. Eventually 25 boys and 25 girls were selected. Each received a scholarship – full board and tuition. Thirteen-year-old Seiha was one of those chosen. His impoverished parents were thrilled. “They support me a lot because they wish they could go to this school when they were my age. Because when they were my age, it requires a lot of like money and working to get to school. And this school pay – we pass a scholarship and it’s free,” said Seiha.
Rainsy to ‘rearrange’ Kingdom PPP 5th Oct 2015
Opposition leader Sam Rainsy held a Pchum Ben ceremony yesterday for the spirits of those killed in the still-unsolved 1997 grenade attack on an opposition rally, promising attendees that should his party win in 2018, he would “rearrange” the country’s government to ensure institutions’ independence. Though the message was consistent with frequent Cambodia National Rescue Party promises to ensure an independent government, it seemingly clashed with remarks delivered by Rainsy just the day before in which he reassured Cambodia’s civil servants that their jobs were safe in the event of a CNRP victory in 2018. An ultimately stymied investigation into the grenade attack by the US Federal Bureau of Investigation pointed to government involvement in the attack, which killed 16 and left more than 100 wounded. The Cambodian government’s investigation technically remains open, but no perpetrators were ever brought to justice – a fact Rainsy yesterday blamed on a judiciary beholden to the rich and powerful. “Who can make a way for the court to work independently and effectively?” Rainsy asked.
Rainsy Says CNRP Is Not Out to Kill Tycoons Cambodia Daily 3rd Oct 2015
Opposition leader Sam Rainsy told more than a hundred CNRP officials on Friday that the party’s proposal to retake land that has been illegally seized by the country’s rich must not be seen as an attempt to strip wealth from those who have earned it legitimately. Delivering the opening speech at a conference in Phnom Penh to discuss strategies to win the commune elections in 2017 and the national election in 2018, Mr. Rainsy said accusations by the ruling CPP that the CNRP intended to “kill” the country’s elites were unfounded. “Regarding the accusation about land seizures, it has been called a class war because the allegation is that the CNRP hates the rich so it will get rid of the rich by taking their properties to give to the poor or kill the rich when the CNRP comes to power,” he said. “We don’t intend to kill the rich as they have claimed. It is totally wrong,” Mr. Rainsy said. The opposition leader said that the CNRP respected entrepreneurs who had accrued their wealth through legal means, noting his own admiration for Microsoft founder Bill Gates, one of the richest men in the world.
Potholes on a path to progress PPP 2nd Oct 2015
Cambodia marginally improved its global competitive ranking this year, moving up five spots to place 90th out of 144 nations surveyed, with weak public institutions and lack of innovation continuing to affect its economic progress, according to a newly released World Economic Forum report. The Global Competitiveness Report for 2015-2016 (GCR) had the Kingdom lagging behind most ASEAN member states, except Myanmar, which ranked 131. Bigger ASEAN economies such as Singapore, Malaysia, Thailand and Indonesia, ranked in the top 50. Cambodia’s overall ranking was dragged down by its lack of capacity to innovate and a poor score on business sophistication – a metric that assesses the value of business networks as well the quality of the individual firms. While these factors would continue to plague Cambodia in the short term, using its strategic geographical location should help improve that, according to Hiroshi Suzuki, lead economist at the Business Research Institute for Cambodia. “Using the improved connectivity among the region, which is an advantage for Cambodia, business sophistication would be improved,” he said. Despite the Kingdom’s low competitiveness ranking, Suzuki said investors would instead base their investment decisions on the kind of industry they are looking to set up here, though there will be limitations when it comes to attracting heavy industry.
Gang of four: Cambodia’s new political parties PPP 1st Oct 2015
Four new political parties have entered the fray in Cambodia since the start of the year. And it’s not just the long-ruling Cambodian People’s Party in their sights, but the opposition too Mam Sonando is disappointed. The independent journalist and director of Beehive radio station was once a staunch supporter of Cambodia’s largest opposition party, the Cambodia National Rescue Party (CNRP). He even campaigned for them on his radio station during the 2013 elections. Today, however, he says he has lost faith in the party and in its two leaders, Sam Rainsy and Kem Sokha. “The CNRP’s supporters, like myself, feel disappointed because the party has not followed what they promised. We no longer feel the CNRP represents the people’s wishes,” Mam Sonando said. He has a long list of criticisms: the CNRP “went against what the people wanted” by accepting the 2013 electoral result; the so-called ‘culture of dialogue’ between the CNRP and the ruling Cambodian People’s Party (CPP) has made the parties “too close”; the CNRP’s leaders are no longer “interested in the people, only power”. Because of this, the 73-year-old recently resurrected the Beehive Social Democratic Party (BSDP), a political party he had founded in the late 1990s that folded after not winning any seats in the 1998 election.
Situation ripe for strikes: study PPP 30th Sep 2015
Short-sightedness, weak adherence to the law and poor working conditions in Cambodia’s garment sector are creating a fertile field for strikes to prevail over negotiations, a recent study released by the Arbitration Council Foundation, an independent labour mediator, has found. According to the study, incidents of striking have considerably increased in the disputes the council mediated, going from 17 in 2012 to 94 in 2014. While compensation issues were by far the most common demands in strike cases the council oversaw – making up 37 per cent of all cases during a one-year period from April 2014 to 2015 – it was far from the only factor enabling the proliferation of strike action. Because many employers offer only the most minimal protections required by the law, strikes are not used as a last resort but as a negotiation tactic, the study says, beginning on an “ad hoc basis rather than as part of a campaign to achieve broad based CBAs [collective bargaining agreements]”.
Hun Sen Touts Cambodia’s Approach To Closing Gender Gap VOA 30th Sep 2015
Prime Minister Hun Sen addressed world leaders at the UN on Sunday, giving his formula for closing the gender gap. Speaking at a global leaders summit on the subject at the United Nations, Hun Sen said closing the gender gap in developing countries requires a four-prong approach: increasing investment in gender equality; ensuring the protection of women’s rights; strengthening government institutions; and continuing to promote women’s involvement in the economy and their financial inclusion. Hun Sen touted “remarkable progress” by Cambodia in promoting gender equality over the last 20 years, with the adoption of laws and regulations to protect women from discrimination and violence. Cambodia has achieved its Millennium Development Goals for decreased maternal mortality, he said, as well as promoted women in all ranks of government and in the legislative and executive branches.
Parties’ rhetoric heats up PPP 28th Sep 2015
Opposition deputy leader Kem Sokha has promised to retire from politics if his Cambodia National Rescue Party does not win the province of Kampong Cham in the 2018 national elections. The CNRP deputy president made the comments in a speech in Kampong Cham on Saturday, during which he also urged other parties that intend to field candidates in 2018 to join forces with the country’s main opposition. “I dare to say that we will win because the [CNRP] is still keeping to its position and not turning away. I want to call on all Khmer patriots in all political parties to consider the national democratic interest and unite with the [CNRP],” he said. “Because [the ruling Cambodian People’s Party] knows our stance is to win and to guide the country to change the leadership … [CPP politicians] are angry,” he added. Sokha’s comments came just days after Prime Minister Hun Sen told a gathering of Cambodian expatriates in the US that the CNRP had “a plan to topple” the government “through people power” at the last election in 2013. Hun Sen quoted Sokha as saying that if the premier did not step down he would be forced out as a “final measure”.
Bar association rebuts report PPP 28th Sep 2015
The Bar Association of the Kingdom of Cambodia (BAKC) has hit back at a damning report from the International Bar Association (IBA), refuting accusations that it is a politicised facilitator of endemic corruption in the judiciary. In a statement released on Saturday, the BAKC insisted it supports and protects its members, who maintain professional and ethical conduct that is untainted by political considerations. The statement suggested the report released by the IBA’s Human Rights Institute on September 17 was not thoroughly investigated and largely reliant on outdated hearsay. “This report . . . is incorrect and dramatically biased; it might be an attempt to ruin the attorney profession and deceive the Cambodian society,” the statement said. BAKC president Bun Hun yesterday refused to expand on the statement. At the time of publishing its report, Justice Versus Corruption: Challenges to the Independence of the Judiciary in Cambodia, the IBA said it had based its findings on a weeklong fact-finding mission in April, during which its representatives met with Cambodian lawyers, judges and civil society representatives.
ADB trims Kingdom’s economic forecast PPP 23rd Sep 2015
Cambodia's economy will feel turbulence from beyond its borders as China’s heavyweight economy faces softer growth prospects and major industrial economies experience a lethargic recovery, the Asian Development Bank (ADB) said in a report released yesterday. In an update to its flagship annual economic publication, Asian Development Outlook (ADO) 2015, the bank’s economists forecast slightly lower expectations for Cambodia’s economy in the face of “strong economic headwinds.” Their revised outlook for Cambodia’s economy is 7 per cent GDP growth in 2015 and 7.2 per cent in 2016, down from the 7.3 per cent growth in 2015 and 7.5 per cent in 2016 projected in the ADO report, released in March. The report said Southeast Asian economies are bearing the brunt of slower-than-expected growth in India as well as China, coupled with concerns over US dollar appreciation in major industrial markets. Cambodia is also facing some internal pressures including the impact of a drought that has affected its agricultural production. “The expansion of garment manufacturing, construction and services – in particular tourism, finance and real estate services – continues to propel [Cambodia’s] growth,” said ADB senior country economist Jan Hansen. “Growth in exports and tourism, however, decelerated somewhat in the first half 2015 while agriculture has been affected by prolonged low rainfall.” The Kingdom’s garment and footwear exports climbed 11 per cent in the first half of the year, decelerating from 14.5 per cent in the same period in 2014.
Group Finds Judiciary Wracked With Corruption Khmer Times 17th Sep 2015
The human rights wing of the International Bar Association has found Cambodia’s judiciary is riddled with problems that corrode citizens’ rights to a fair trial, including widespread graft. The organization published the results of a series of interviews with lawyers, judges and civil society groups yesterday, finding problems to be widespread. They reported endemic bribery on the part of judges, bailiffs and court clerks, as well as political pressure from members of the government that influences court decisions. They also describe serious structural problems, like a shortage of courthouses, low pay for judges and a huge gender gap in the representation of women in the courtroom. Exacerbating the problems, they wrote, are the electoral reforms passed last year, which have ingrained a system in which judges are at the mercy of the ruling Cambodian People’s Party (CPP) leaders in the Ministry of Justice for their professional survival. “In a nutshell, our concerns boil down really to one thing,” said Mark Wassouf, a Barrister at London’s Doughty Street Chambers. “That’s the potential that’s contained in all of [the laws] for the government to have undue influence over the judiciary.
Customs
Trade Deal a ‘Wake-up Call’ for Cambodia Khmer Times 6th Oct 2015
The Commerce Ministry is looking closely into the ramifications of the Trans-Pacific Partnership (TPP) signed by 12 nations on Monday, especially at how it may affect exports, as Cambodia is not included in what is being billed as the world’s largest free-trade market, Commerce Minister Sun Chanthol told Khmer Times yesterday. Mr. Chanthol also said he would not have the details of the agreement, which followed five years of negotiations between 12 Pacific Rim countries, until the end of this year. “The TPP meeting just finished yesterday and the document is secret. I will have the document by the end of the year, but we are already looking into and studying how the TPP will impact our economy,” Mr. Chanthol said.
Smoother path for agro exports The Phnom Penh Post 25th Sep 2015
The ministry of Agriculture plans to establish five regional food safety inspection offices near the country’s borders to facilitate the flow of cross-border agricultural trade, reducing the time it takes Cambodian exporters to deliver shipments of agricultural products to foreign markets, a ministry official has said. The new regional offices would inspect export shipments of food and agricultural products, ensuring that they comply with Sanitary and Phytosanitary (SPS) protocols and issuing certificates required by foreign purchasers. The inspections could eventually include imports as well. Hean Vanhorn, deputy director general of the General Directorate of Agriculture at the Ministry of Agriculture, said the new SPS offices would ensure that agricultural products leaving the country are free of pests, diseases, toxins or contaminants. The offices would include laboratories, fumigation equipment and quarantine facilities.
Defense & Security
Cambodia’s Withering ‘Culture of Dialogue’ The Diplomat 12th Oct 2015
As Prime Minister Hun Sen continues a streak of crackdowns and power plays aimed at weakening Cambodia’s main opposition party, the country’s precarious “culture of dialogue” seems to be in danger of devolving into a stern lecture under the longtime autocrat a little over a year after an initial bipartisan truce was struck. A Phnom Penh court’s decision to deny an opposition senator’s request for bail and postpone his trial is the latest test for the “the culture of dialogue,” the moniker given to the country’s uneasy political peace forged between Hun Sen and Cambodia National Rescue Party (CNRP) President Sam Rainsy in the aftermath of 2014’s bloody post-election season and a tense 10-month political standoff. Hong Sok Hour, a senator with the Sam Rainsy Party* (SRP), was arrested on charges of forgery and treason on August 15 following a public order by Hun Sen, after the senator posted a fake version of a 1979 border treaty between Cambodia and Vietnam. Human Rights Watch has decried the case, calling on the Cambodian government to drop the case against the “wrongfully” charged lawmaker, who also happens to be in ill health. “The culture of dialogue is basically a farce,” said Ou Virak, the head of Future Forum, a Phnom Penh-based policy institute. “It was not there from the beginning. You have two parties who are pretty much vying for power, trying to play nice, and that was basically it.”
ASEAN Peacekeeping Meeting Concludes in Cambodia The Diplomat 9th Oct 2015
This week, senior peacekeepers from the Association of Southeast Asian Nations (ASEAN) met in Phnom Penh for the 3rd ASEAN Peacekeeping Centers Network Meeting. As I have noted previously, since most ASEAN members have participated to varying degrees in United Nations peacekeeping operations and have already set up national peacekeeping training centers, the grouping has set up a network among these centers – known as the ASEAN Peacekeeping Centers Network (APCN) – and has held meetings on the subject with the first being held in 2012 in Malaysia (See: “Malaysia Wants an ASEAN Peacekeeping Force”). These meetings, as Prak Sokhonn, the chairman of Cambodia’s National Coordination Committee of UN Peacekeeping Operations put it at the opening ceremony in Phnom Penh on Wednesday, offer a platform for participants to share views and experiences on peacekeeping missions and enhance relations among ASEAN peacekeepers. In terms of outcomes, according to the Phnom Penh Post, Major General Ker Savoeun, director of the Cambodian defense ministry’s peacekeeping center, said that this meeting had agreed on high-level exchanges in which peacekeeping heads would facilitate “an exchange in expertise.” The outcomes represent a continuation of the incremental progress ASEAN has been making in the peacekeeping realm. According to the UN, ASEAN has collectively contributed almost 5,000 peacekeeping personnel, which represents about 5 percent of global contributions. As I noted before, Malaysia, which holds ASEAN’s rotating chairmanship this year, has been advancing a far bolder proposal for an ASEAN peacekeeping force which still facing some familiar obstacles within the grouping (See: “ASEAN Eyes Closer Military Ties in 2015”).
Energy
Petrol prices dip for holiday PPP 9th Oct 2015
Following another meeting between the Ministry of Commerce and petroleum retailers yesterday, both sides were unable to formulate a uniform pricing mechanism for petrol prices across the country, with Commerce Minister Sun Chanthol instead urging retailers to drop prices by 100 riel for the Pchum Ben holiday. The meeting, which was held after oil companies operating in Cambodia submitted documents on their individual price structures, was unable to settle on a single, comprehensive pricing formula given the differing cost structures for each company, said Ken Ratha, spokesman for the Ministry of Commerce. “It is difficult to decide one formula to fit all. Every company has its own internal information related to pricing and in a competitive market they are afraid, other companies will know their pricing strategy,” he said. Ratha said that the ministry would meet each retailer individually to better understand their pricing structure before convening again as a group to set a pricing mechanism. A date for the meeting was not set. Most of the participants at yesterday’s meeting agreed to a nominal price drop for the Pchum Ben holiday, one of the busiest travel times of the year. The 100 riel drop will be effective from today until October 15.
Ministries Racing to Draft 'Transparent' Petroleum Laws Khmer Times 28th Sep 2015
The Ministry of Economy and Finance and the Ministry of Mines and Energy are joining forces to accelerate drafting two pieces of legislation that will lay a transparent foundation for the growth of the Kingdom’s oil and gas industry, a senior official told reporters yesterday. Officials at both ministries are working overtime to finalize the two laws – one that will govern the petroleum industry and another that will create a taxation regime for it – early next year, said Meng Saktheara, spokesman for the Ministry of Mines and Energy. “Now, both ministries... are closely cooperating to prepare the two main laws – a petroluem law and a law on oil and gas taxation. The laws will help [us] a lot to enforce, encourage and attract more foreign investors to increase exploration of our potential oil and gas resources,” he said. Mr. Saktheara said the laws will benefit the economy as they will ensure the transparency necessary for the industry to grow. The laws will “ensure transparancy in national revenue [collection] from the oil and gas business,” he said. "This will enhance for new industry, to use the domestic service and product for increasing the other supportive industry as well as to diversify our industry sector for the economy.” The government previously set, and missed, a deadline for extracting the first drop of oil for December 12, 2012.
Gov’t Warms to Solar Power Expansion to Meet Electricity Needs Cambodia Daily 19th Sep 2015
High electricity prices, limited connectivity to the national grid and frequent power outages all point to the need for innovations in Cambodia’s energy sector, and government officials and experts agreed on Thursday that solar power should be given a prominent place in future plans. Speaking at a conference on clean energy in Phnom Penh, Ken Sereyrotha, deputy secretary-general of the National Council for Sustainable Development, admitted that Cambodia still has a long way to go in ensuring its energy needs are met in a sustainable way. While current government policy favors hydroelectric dams—multimillion dollar infrastructure projects mostly funded by China —he said the policymakers should be cautious about relying solely on these dams and fossil fuels to meet the country’s rapidly rising electricity demands.
Gov't Urges More Green Investment Energy Khmer Times 18th Sep 2015
The government and the Enrich Institute urged Cambodian businesses to invest in clean energy, and called on citizens to use it as well, at a forum on sustainable development yesterday. The event was held to show the progress Cambodia has made in the clean-energy sector as well as highlight potential investment opportunities in solar, wind, hydropower and bio-mass energy, said Heng Pheakdey, founder and chairman of the Enrich Institute. The institute promotes green energy and sustainable development. “If we use clean energy, it will provide many benefits for us,” Mr. Pheakdey said. “We can reduce our imports of diesel fuel.” The government should provide incentives for investors who want to import equipment to create and harness clean energy as well as decrease taxes on technology needed for sustainable development, he said. Mr. Pheakdey pointed out that solar power is not widely used in Cambodia, but the usage of solar panels by households is growing. Cambodia imports 90 percent of the diesel fuel it needs for domestic electricity, and this is greatly affected by fluctuating global prices. Dependence on diesel fuel contributes to climate change, which is already having a significant impact on weather patterns and farming in Cambodia. "Only 35 percent of Cambodia's population has electric power," Mr. Pheakdey said. "Ninety percent of power for households is generated by diesel-burning generators."
Financial Services
Cambodia: Bank deposit insurance proposed Asia Insurance Review 15th Oct 2015
A deposit insurance scheme is deemed as needed in Cambodia, which is the only country in ASEAN with the exception of Myanmar that has yet to implement such a scheme. The debate over a deposit insurance scheme arose following a proposal put forward at a recent banking conference organised by the National Bank of Cambodia (NBC), the Kingdom’s central bank. The proposal is for the deposit insurance fund to be administered by a legally separate entity within the central bank that would step in to pay depositors in the event of a bank’s collapse, reported the Phnom Penh Post.
Is It Time for Cambodia to Wean Itself Off the Greenback? Wharton 6th Oct 2015
The National Bank of Cambodia last month unveiled a new strategy to urge its citizens to use the riel, its local currency. Chea Serey, director general of the country’s central bank, reassured the market there would not be any sudden switch; instead, the authorities would rely on public education and marketing campaigns to encourage people to use the riel. In this interview with Knowledge@Wharton, Cambodia’s top central banker said the last thing Cambodia wants is to create panic in the capital market, especially for an economy highly reliant on foreign investment. At the same time, the persistence of the dollar means continued loss of economic sovereignty, national pride and seigniorage (the profit made by a government by issuing currency, based on the difference between a currency’s face value and its cost of production).
Bank data show remittance flows rising The Phnom Penh Post 9th Oct 2015
Cross-border remittance transfers continue to rise despite slower growth in Asian economies as more Cambodians seek work abroad to support their families back home, an economist said yesterday, commenting on recent data. Worker remittances, which comprise personal transfers by migrant workers to their households back home, doubled last year and continue to grow. Cambodian migrant workers sent the equivalent of $363 million home in 2014, up from $167 million a year earlier, according to central bank figures. Worker remittances amounted to $110 million in the first quarter of 2015, putting the year on course to top $450 million.
Central bank takes breather as it reins in rural lenders The Phnom Penh Post 7th Oct 2015
Cambodia's central bank will temporarily suspend its eight-month campaign to bring informal moneylenders into its fold as it lacks the resources to review the mountain of registration applications it has received and needs time to tweak the licensing requirements, a National Bank of Cambodia (NBC) official said yesterday. Khieu Bophaphuong, director of the NBC’s licensing department, said the NBC received 285 applications from NGOs and rural credit operators since announcing a registration drive in February aimed at expanding its oversight of unofficial lenders. Of these, 185 applications have been reviewed and the NBC has issued operating licences to 44 rural credit operators. The registration drive aims at protecting consumers from the increasing prevalence of unlicensed moneylenders, who banking experts say often operate masquerading as NGOs or microfinance institutions, charging exorbitant interest rates.
Money launderer’s dream PPP 5th Oct 2015
Cambodia's anti-money laundering agency is unable to investigate or penalise financial institutions that break the law, leaving the country open to exploitation by organised crime, according to a senior official in the unit. The Financial Action Task Force (FATF) – the top international anti-money laundering and counterterrorism financing body – ceased its monitoring of Cambodia in February, even though the Financial Intelligence Unit (CAFIU), the state agency tasked with investigating and prosecuting financial crimes, was so under-staffed and under-resourced it had not investigated a single financial institution since its founding in 2008. In early 2014, Cambodia was downgraded to FATF’s “dark-grey list” for lacking an asset-freezing instrument or a currency declaration system. The downgrade left the Kingdom just one step away from being blacklisted as a high-risk jurisdiction. The government passed a sub-decree only a month later, which amended the 2007 Anti-Money Laundering Law to meet FATF’s requirements, leading the body to remove Cambodia from the list. However, despite the progress on paper, CAFIU adviser Phan Ho told Daniel Glaser, assistant secretary for terrorist financing at the US Treasury Department, that while the unit was “working very hard to enforce” the law it “had only 10 people to inspect 38 banks and 37 [micro-finance institutions]”.
Removing capital barriers for SMEs PPP 2nd Oct 2015
FASMEC Microfinance, which opened its doors last month, was created by the Federation of Associations of Small and Medium Enterprise of Cambodia (FASMEC) as an independent entity to service the financing needs of the organisations’s members. The Post’s Sor Chandara sat down with FASMEC Microfinance’s president Te Taing Por to discuss how Cambodia’s 54th microfinance institution will separate itself from the pack, as well as governmental efforts to bring more formality to the small and medium enterprise sector.
Bank deposit insurance proposed for riel security The Phnom Penh Post 2nd Oct 2015
Cambodia has yet to establish a deposit insurance scheme, which means if a bank has a run on deposits or goes belly up, its customers could lose all their savings. Stephen Higgins, managing partner of Mekong Strategic Partners, says it is time the Kingdom joins the 122 countries that have instituted a mechanism to protect the deposits of bank customers from loss in the event of a bank’s insolvency. “Cambodia is the only country in ASEAN with the exception of Myanmar that has not implemented deposit insurance,” he said in a phone interview yesterday. “Myanmar’s banking sector is 10 years behind Cambodia’s, so it is not a country we should compare it to.” Higgins has proposed instituting a national deposit insurance scheme based on international models that imposes a nominal tax on banks and microfinance institutions (MFIs) to build an insurance fund that covers their customers’ deposits in part or in full.
Credit Bureau Targets Students With Workshops Cambodia Daily 30th Sep 2015
Hoping to increase university students’ knowledge of Cambodia’s credit reporting system, the Credit Bureau of Cambodia (CBC) on Tuesday launched a series of workshops in Phnom Penh aimed at boosting financial literacy. Oeur Sothearoath, head of business development at the CBC, said the first seminar, held Tuesday at Build Bright University and attended by about 120 students, sought to engage young people before they start careers. “Each consumer has the right to get information about their credit, but they don’t seem to know what rights they have…. Students have not used credit much, but they will become potential credit users in the future,” Mr. Sothearoath said.
Central bank urges riel spending The Phnom Penh Post 30th Sep 2015
Cambodia’s central bank yesterday again raised the issue of the country’s highly dollarised economy, suggesting that government policies and action plans will be enforced over the long term to promote the use of the riel, giving the National Bank of Cambodia (NBC) more monetary control. Speaking at the Second NBC Macroeconomic Conference yesterday, Neav Chanthana, deputy governor of the NBC, said that while Cambodia’s economy has reaped the benefits of dollarisation it was also a key challenge now. “Dollarisation presents risks and vulnerabilities, given the size of the economy and financial sector has grown remarkably,” Chanthana said.
Bourse softens listing criteria The Phnom Penh Post 18th Sep 2015
For companies looking to float shares on Cambodia’s fledgling stock exchange, the rules have just been made easier. After three years and only two listings, the Securities and Exchange Commission of Cambodia (SECC) has revamped the listing criteria, in a bid to increase the number of companies traded on the Cambodia Securities Exchange (CSX). This comes on the heels of a new regulatory framework for a “Growth Board” on the CSX – aimed at attracting small- and mid-cap companies – that was announced last week.
Food & Agriculture
Burger King to expand realm PPP 23rd Sep 2015
Having established a foothold in the capital, Burger King is pushing into Cambodia’s provinces and will launch its first branch in Siem Reap next month, a company official said yesterday. In all, the US fast-food giant plans to open four branches outside the capital by the end of 2016, with locations in Sihanoukville, Battambang and Poipet set to open after Siem Reap, according to Fin Sotheany, operations manager for Burger King Cambodia. Cam F&B Services – a joint venture between Vietnamese conglomerate Pan-Pacific Group Inc (IPP) and local partner HSC Group – operates Burger King in Cambodia. The company currently manages five outlets in Phnom Penh. A sixth outlet will open on Mao Tse-tung Boulevard in the capital next month, Sotheany said. The new Siem Reap branch is being constructed in a high-traffic tourist area, tucked between Pub Street and the Night Market. It is scheduled to open by mid-October. “Siem Reap has a lot of potential, and a lot of tourists, and that’s why we’re going there before the other provinces,” said Sotheany. Burger King is only the second international fast-food chain to open in Siem Reap after KFC, which opened a restaurant there in 2009.
Economy eases off the pedal Phnom Penh Post 6th Oct 2015
Cambodia's economy is expected to grow by 6.9 per cent in 2015, driven by the construction sector, while traditional growth areas, such as garments and tourism, are expected to see a relative slowdown this year, according to a World Bank economic report. Yesterday’s update on the status of East Asia and Pacific economies mirrors the World Bank’s Cambodia Economic Update released in April, which also estimated 6.9 per cent GDP growth for 2015, as compared to the 7.1 per cent achieved in 2014.
Hun Sen Warns on Rains, Rice Khmer Times 6th Oct 2015
Prime Minister Hun Sen yesterday expressed concern about agricultural productivity in the rainy season, as the rains so far this year have been worryingly scarce. On his official Facebook page, Mr. Hun Sen warned farmers rice production would be hit because of the impact of the poor rains on the water levels of the Mekong, Tonle Sap, Bassac and other rivers, which prevents them filling inlets, other rivers, and ponds.
Health & Life Sciences
Cambodia seeks way out of post 'killing fields' mental health crisis Reuters 5th Oct 2015
Hing Phon thought she was losing her mind when night after night terrifying nightmares jolted her awake as she dreamt of her husband, eldest son and 18 other relatives being killed by the Khmer Rouge during their brutal reign in Cambodia. Pitting poorer farmers against richer ones, the Khmer Rouge inflicted extreme cruelty and violence on people in her village in the southern province of Kampot when they took control of the area in the early 1970s. "So many nights I could not close my eyes because the memories of my loved ones would haunt me," the 81-year-old said, resting in the shade outside her house in a hamlet some 120 km (75 miles) south of the capital Phnom Penh. "We lived through a nightmare," she said, her back stooped from years of forced labor in the fields during Pol Pot's "year zero" quest to create a classless, agrarian society. During the regime's genocidal wave of terror from 1975 to 1979, at least 1.8 million people - about a quarter of the population - died through torture, execution, disease, overwork or starvation.
Pregnant Women Still Fight for Healthcare Khmer Times 14th Oct 2015
Despite drastic improvements in Cambodia’s maternal healthcare system and an expansion of services to more remote provinces, poverty-stricken mothers are still forced to endure a number of challenges when dealing with pregnancy issues. One of the main challenges they face is the choice between private clinics and hospitals. Both public hospitals and clinics, some of which are unlicensed, have been criticized for allegedly turning away poor patients, forcing them to go to overwhelmed, larger public hospitals to deal with any problems with their pregnancy. Critics have said private clinics are notorious for turning away patients unable to pay for their care, especially poor mothers looking for pre- and post-natal care.
Malaria money sits idle The Phnom Penh Post 9th Oct 2015
Millions of dollars of aid money granted to Cambodia by the Global Fund to combat malaria have been left sitting in a bank account for more than a year, official documents seen by the Post show. The money remains untouched because the National Malaria Centre (CNM) is refusing to sign a funding agreement for a $12 million Global Fund grant it could have accessed since July because it objects to a request to provide detailed accounts of the spending, a source close to the Global Fund in Cambodia said, a move that could potentially put thousands of lives at risk. The source said that the CNM had spent virtually none of a separate $9 million grant it has been entitled to use since August 2014.
Measles confirmed in rural Cambodia less than a year after being ‘measles-free’ Outbreak News Today 9th Oct 2015
Eight months after the World Health Organization (WHO) declared Cambodia measles-free, the health ministry and WHO announced October 8 that a case was confirmed in rural Cambodia.
ICT
Media Experts Warn Against a Cyber-Crime Law That Hurts Online Freedom VOA Khmer 12th Oct 2015
As the Cambodian government moves forward with the creation of a law to regulate cyber-security, experts say any legislation should include clear language to prevent abuse of the law and restrictions to online freedoms. A draft of the law from July obtained by VOA Khmer says its objective is combating digital crimes, intercepting data and preventing fraud and pornography. But Moeun Chhean Naridh, director of the Cambodia Institute for Media Studies, said the law should not be written in a way that will damage democratic rights. “Today we have the Internet system, as well as social media, such as Facebook, Twitter, YouTube, and blogs, which make people, as voters, participate directly in the democratic process,” he said. “So if the press and the public in general cannot use the basic rights ensured by the constitution, it will negatively impact a government that has the will to have good governance.” The best form of government is a democracy that has the direct participation of the public, he said. In Cambodia, the Internet is helping provide that, “as the voters participate directly in the democratic process, especially in elections every four years.”
Cambodian gov't approves telecom draft law Khmer Times 10th Oct 2015
The Cambodia's Council of Ministers on Friday passed a draft law on telecommunications, which is designed to enhance telecom quality and to attract more investors in the sector, according to a news statement. The passage was made during a weekly cabinet meeting, which was chaired by Prime Minister Hun Sen, the statement said. "The draft law is aimed to ensure the quality and efficiency of telecom infrastructures, networks, and services, and to encourage investments in this sector," the statement said. "It is also to protect the interest of users and to mobilize revenues for the national coffer." According to the constitution, the draft law needs to be approved by the national assembly and finally reviewed by the senate before being submitted to King Norodom Sihamoni for promulgation. Cambodia currently has six mobile phone operators, some 27 Internet service providers, and two fixed phone companies. By August 2015, the mobile phone operators have sold 21 million SIM cards, exceeding the country's population of 14.8 million, said the Telecommunication Regulator of Cambodia, adding that over 5.8 million people have access to the Internet. The fixed phone operators are serving nearly 300,000 customers, it said.
Telecoms unfazed by SIM edict PPP 24th Sep 2015
Telecom operators responded yesterday to a new government directive that requires retailers to collect identification documents before selling mobile phone SIM cards to customers, playing down the potential impact on their sales and saying they would cooperate with regulators to implement the diktat. “We will work together with the industry and regulatory bodies to ensure that the directive is being complied to,” said Thomas Hundt, CEO of mobile operator Smart Axiata, which reported around 6.6 million subscribers as of March. Officials from the National Police and the Ministry of Posts and Telecommunications announced on Tuesday that retailers must ensure that customers supply identification documents before selling SIM cards or face arrest. The directive also ordered telecom firms to get their existing subscribers to register their ID documents within three months, or their mobile phone numbers would be terminated. A ministry official estimated that nearly 70 per cent of the Kingdom’s 20 million SIM cards had no identification attached to them. He said the crackdown aimed at curtailing criminal and terrorist activities, though rights groups have warned it could be used to curtail civil liberties. Hundt said the regulation was not new, but had not been enforced.
Not waiting on Apple PPP 16th Sep 2015
Cambodian consumers are queuing up to get their hands on the latest models of the iPhone, with some local grey-market retailers promising to stock the highly anticipated handsets months ahead of their expected official launch in the Kingdom. Apple Inc will launch its new iPhone 6S and iPhone 6S Plus handsets in 12 international markets on September 25. No official date has been given for their release in the Cambodian market, but retailers looking back to the sales frenzy surrounding the iPhone 6’s debut last year say they are tapping their international networks to cash in on the lucrative trade in “flipped” smartphones. Chhim Sang Heng, the owner of Hak Se phone shop in Phnom Penh, says he plans to begin selling phones in his shop within hours of their international release. “I have many customers who have already pre-ordered the 6S even though they don’t know the price yet,” he said. “My friends will wait in line at the Apple store [overseas] to buy it and bring the iPhone to me in the evening.” Heng said that during previous iPhone model releases, stock ran out on the launch date before many of the customers queuing at Apple stores overseas could purchase the handsets, despite Apple imposing a two-phone limit per customer.
Chuan Wei taps Alcatel-Lucent for LTE rollout Telecomasia 30th Sep 2015
Cambodia's Chuan Wei has contracted Alcatel-Lucent to deploy the LTE and VoLTE components for the operator's high-speed broadband network expansion. Under the agreement, Chuan Wei will deploy an FDD LTE RAN, IP mobile core and backhaul connectivity from Alcatel-Lucent, as well as software support systems. Network deployment will begin in densely populated areas including capital Phnom Penh and the tourist destinations of the nation's Siem Reap region, such as the famous Angkor Wat temple. It will continue in the cities of Poipet and Bavet before expanding to other major cities across the country. The project is experted to be complete by mid-2016.
Infrastructure
Cambodian mining digs itself out of a hole Nikkei Asian Review 12th Oct 2015
Cambodia's long-dormant mining sector could finally be seeing some movement after years of aborted foreign-backed projects, as the government introduces wide-ranging reforms in an effort to turn around the country's economic fortunes. Crucial new mining legislation proposed by the government of Prime Minister Hun Sen is aimed at bringing the fledgling industry in line with international practices in order to attract investment and compete with other regional economies. The draft law, expected to be approved by the end of the year, sets out reforms to tackle key issues that have long plagued the sector, such as illegal mining. The government is already forcibly closing illegal mines if they fail to meet deadlines to shut down operations voluntarily. While the potential of the largely undeveloped industry remains uncertain, research has suggested "good prospects in gold and copper," said Meng Saktheara, a secretary of state at Cambodia's Ministry of Mines and Energy, which is spearheading the reforms. If such predictions prove accurate, mining could become a "priority sector" from 2018, when a new government is scheduled to take office.
Construction: the most dynamic engine of growth PPP 8th Oct 2015
While the World Bank projects that Cambodia’s GDP growth will slow to 6.9 per cent this year largely due to the underperformance of rice production, the competitive pricing pressure on the garment industry and a slowdown in tourism, the construction sector continues to boom – and is now the most dynamic driver of GDP growth. Last year, it outpaced garment and footwear for the first time, according The East Asia Pacific Economic Update that was published by the World Bank this Monday. “Construction and real estate represented 2 per cent growth out of the 7.1 growth in GDP last year. This is the largest contributor. It is booming and quite hot,” said Sodeth Ly, country economist at the World Bank in Cambodia. In 2013, construction and real estate only accounted for 1.3 per cent of GDP growth. Considering the figures for construction and real estate sector imports, Ly predicts it will continue an upward trajectory. For the first half of this year, 1.2 million metric tons of construction materials were imported with steel increasing by 32 per cent, cement by 8 per cent and general materials by 38 per cent. “But there are both pros and cons of construction growth. And the risk associated with this growth is a [construction] bubble. But there is no bubble yet, but [it] is something we have to watch out for because our construction is driven by FDI,” said Ly.
EDCF is building the infrastructure backbone of Cambodia PPP 30th Sep 2015
Since South Korea’s Economic Development and Cooperation Fund provided its first loan to Cambodia in 2001, EDCF’s total commitment in Cambodia has reached $600 million across 18 projects. Cambodia now ranks fourth in terms of accumulated loan commitments among 52 partner countries of EDCF as of 2014. In 2013, a framework arrangement was agreed between the Cambodian and Korean governments with a maximum commitment of $200 million, approving five new projects with a commitment of $230 million. These investments have helped to foster stronger diplomatic and economic ties between Cambodia and Korea. EDCF’s policy in Cambodia is based on the country partnership strategy led by the Korean prime minister’s office, in line with the priorities of the Cambodian Rectangular Strategy Phase and the National Strategic Development Plan. Accordingly, EDCF has focused its support on infrastructure development in Cambodia, such as transport and water resources, with the aim of achieving economic growth and poverty reduction. Of the18 projects planned so far, nine projects are related to road construction and improvement, focusing on rural road networks that remained in poor conditions. The areas range from southern regions (Kampot and Takeo), central regions (Tonle Sap Basins), to north-western provinces (Sisophon and Samrong). Six projects are involved in the water sector, mainly divided by water resource improvement in Siem Reap and Krang Ponley and dam construction in Sala Ta Orn, Monkol Borey and Dauntri.
Express road to airport in works PPP 23rd Sep 2015
The Ministry of Public Works and Transport yesterday announced the start of feasibility studies aimed at building an express elevated toll road that would extend from Phnom Penh’s city centre to the airport by 2021. Public Works Minister Tram Iv Tek said yesterday that China’s Henan Provincial Communications Planning Survey and Design Institute (HPC) would conduct studies into the viability of three different options for building the road, construction on which would begin next year. Option A involves building an elevated expressway over Russian Boulevard, the main artery between the airport and the city centre. Option B would see the expressway built over rail lines just north of Russian Boulevard that run parallel to the road. Both plans would require an expressway of just over 8 kilometres. Option C, Iv Tek continued, would start near the French Embassy and require 11 kilometres of road. “The expressway in option A will cost around $362 million,” he said. “This option A is a favourite option among the others, because it’s easy to transport the construction materials to build it.” “Through our discussions, we see that many officials prefer options A and B,” Iv Tek said, adding that the study needs to consider whether the new expressway would connect with current overpasses, or have just one on-ramp and one off-ramp.
Manufacturing
H&M workers ‘sold short’ PPP 24th Sep 2015
The widespread use of short-term contracts in Cambodia’s garment industry has come under fire in a new report, which looks at ongoing issues with the practice at H&M supplier factories amid pledges of reform. A Short-Term Solution, which was released yesterday by Swedish NGO Fair Action, uses interviews with workers producing garments for the mega-brand to illustrate how fixed duration contracts (FDCs) can be used to exploit and intimidate. Despite apparent efforts from H&M to address the issue, workers from three of its supplier factories in Cambodia said FDCs had led them not to exercise rights such as taking sick leave or refusing overtime because of a “widespread and continuous fear of not having their contract renewed”. At one factory, the workforce was allegedly employed entirely on FDCs, while at another, moves to put workers onto unlimited duration contracts amid union pressure were short-lived, with many workers now kept on FDCs beyond the two-year legal limit. “Through the trade with factories using FDC workers to illegally make up a permanent workforce, H&M breaches not only the company’s own code of conduct, but also Cambodian labour legislation as well as international norms,” the report notes.
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