Cambodia Must Produce More of Own Products, Experts Say

The overall volume of trade between Cambodia and its neighbors Thailand and Vietnam grew substantially in 2008, but a number of local economists and business leaders say Cambodia must produce more of its own products to narrow the trade gap it has with its neighbors.

Trade between Vietnam and Cambodia increased 31 percent in 2008 to nearly $1.7 billion compared to the previous year, Viet­nam­ese state media reported last week.

However, Vietnam benefits far more from the cross-border commerce, exporting more than $1.45 billion in steel, agricultural supplies and other items to Cambodia while Cambodia only sent produce worth about $250 million to Vietnam, mostly in the form of raw agricultural items such as rubber resin and cassava, the Vietnam News Agency reported.

Thon Virak, deputy director of international trade at the Cam­bodian Commerce Ministry, confirmed Monday that total trade between Cambodia and Vietnam had reached $1.7 for 2008. Trade with Thailand, he said, increased 17 percent to $2 billion in 2008.

Thon Virak added that he could not provide numbers detailing the breakdown of imports versus ex­ports Monday and Tuesday.

“Trade is increasing because of Cambodian economic growth and more consumption in the local market,” he said.

But a number of local economists and businessmen said that Cambodia needs to work to­ward boosting its exports and the number of goods it produces domestically.

“We import large amounts from Thailand and Vietnam, but we export small amounts to those countries,” economist Sok Sina said by telephone. “Cambodia needs to produce more.”

Cambodia must begin producing more processed foods and farming supplies for both the foreign and domestic markets, he said.

Sok Sina noted that many raw materials, such as cassava, cashew nuts and rubber resin, are exported to Vietnam, processed there, and then shipped off to China or even back to Cambodia for consumption. Such processing should be done in Cambodia, Sok Sina said.

Kang Chandararot, executive director of Cambodia Institute of De­velopment Study, agreed, writing in an e-mail Tuesday that Cam­bodia should focus for now on producing simple materials such as hoses and processed food-items that have obvious markets.

He added that more needs to be done to promote Cambodian products abroad.

Khaou Phallaboth, president of the Khaou Chuly Group, said Cam­bodia must aim to diversify the goods it produces and move away from relying on agricultural products and garments.

The owner of a cement plant, Khaou Phallaboth said that more firms should follow his company’s example and produce more such items that are in local demand.                                     Domestically produced steel and other construction materials would reduce the cost of construction and speed up development, he said.

“We need to become less dependent on imports,” he said.

David Sim, a director at Attwood Import Export, said his company is attempting to bring more manufacturers, such as food processing firms, to its special economic zone in Phnom Penh.

“In any developing country, normally, it would be good if they can create many manufacturing bases, then export,” he said.

Several Commerce Ministry officials declined to comment Tuesday.

Finance Ministry spokesman Aun Porn Moniroth and other Finance Ministry officials could not be reached for comment Monday and Tuesday.



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