Despite Special Status, Trade With EU Low

Var Ry, a 44-year-old shopper at Olympic Market, swears by Kampot durian. She claims it is healthier than those from Cambo­dia’s neighbors.

At about $1.15 per kg, locally grown versions of the pungent, yellow-fleshed fruit cost about twice as much as durian imported from neighboring Thailand. But Var Ry said it’s worth it because Cambodian farmers use fewer pesticides than farmers in developed countries.

“Let’s eat Kampot durian,” she said on a recent trip to the durian stand, “instead of durian from neighboring countries.”

But Var Ry’s tastes aren’t shared by everyone, and that is something the Ministry of Com­merce wants to change.

The European Union has granted Cambodia a special trading status, potentially opening Wes­tern markets to more of Cambo­dia’s agricultural goods—if the government can just come up with the right products, officials said last week.

The EU announced in March it was establishing for the world’s 48 least developed countries a generalized system of preferences status for agricultural goods, which would eliminate tariffs. But Cambodia currently has nothing to offer the EU markets, said Khek Ravy, secretary of state for the Ministry of Commerce.

“Right now it is hopeless,” he said.

Cambodia’s agricultural products do not meet EU requirements for sanitation technology, quantity, and sometimes quality, Khek Ravy said.

The Ministry of Commerce and the Ministry of Agriculture are now looking for ways to develop the country’s ability to develop high-quality products at a quantity that would make it feasible to cover the high cost of transportation involved in exporting goods to Europe, he said.

Locally grown durian, the kind Var Ly likes, is enjoying a surge in popularity. And more farmers are growing it. It is more popular, vendors say, because it is organic, and perceived to be safer than foreign durian, which may contain pesticides.

And while that may be good for local durian farmers, the government would still like to find products with export quality.

So the Ministry of Commerce is looking at an itemized list of goods for potential export, said Mok Pichrith, director of the GSP department at the ministry.

Goods like soy beans, peanut oil, corn oil and fresh water fish are all potential exports in the future, but only if Cambodian producers can reach levels of production—and technology—that makes it profitable, Khek Ravy said,

Cambodia’s agricultural export is very low compared to the textile industry, which accounts for almost 90 percent of Cambodia’s total exports. Rubber remains the agricultural product most shipped abroad, with $28.1 million in rubber exported in 1999, according to the Ministry of Planning’s statistical report for 2000.

The government is looking for other products with the potential for export, and ways to improve the quality of those goods.

“I’m confirming with the EU to make sure what the trade conditions are,” Mok Pichrith said, adding, though, that it would be up to farmers and the Ministry of Agriculture to start producing to the EU’s standards.

“We are not in charge of the products quality,” he said. “We are in charge of the market.”

The Ministry of Agriculture lacks the capital to promote growth and change for Cambodia’s farmers, said May Sam Eoun, secretary of state for the ministry.

May Sam Eoun said agricultural production will need a boost from independent investors, citing the progress made by British American Tobacco in expanding its use of locally grown tobacco.

Kompong Cham farmers have consistently been tasked for more tobacco, and some of it has been exported to Sri Lanka.

Mangoes, meanwhile, may enjoy a production boost through a joint effort between the Cambodian and Australian governments and the International Rice Research Institute’s CARDI.

The program is aimed at boosting the quality—in appearance and taste—of locally grown mangoes. To that end, the Cambodian Agricultural Research Development Institute held a contest for best mangoes recently.

The top ten winners were chosen for a research breeding program, which, according to Hun Yadana, a researcher, will “bear fruit” in five or six years.

If the program is successful, the institute may expand its research to other agricultural products.

Meanwhile, the government continues its review of products, and will continue to seek ways to get Cambodian goods into other markets.

“We have to know exactly what the EU’s standards are [first],” May Sam Eoun said. “And we have to produce things to follow the market.”




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