Germany Now Cambodia’s 2nd Biggest Buyer

The importance of Germany as a trading partner with Cambodia in­creased in 2005, officials said Thurs­day, as Germany became the second largest buyer of Cam­b­o­dian exports after the US.

“In past years, the second country was Holland, France or Italy, but in 2005, it was Germany,” said Thon Virak, the deputy director of the Ministry of Commerce’s for­eign trade department. “Trade with Germany keeps increasing ev­ery year,” he added.

According to government data, ex­ports to Germany now comprise 12 percent to 15 percent of Cam­bodia’s $2 billion in exports. In 2005, $250 million of mostly gar­ments and footwear were sent to Germany, a 5.5 percent in­crease over the $237 million in 2004. Only $155 million in exports were shipped in 2003.

Germany’s Ambassador Pius Fisch­er credited good labor standards with increasing the interest of German consumers in Cam­bo­di­an goods. He also warned that a worsen­ing of the political situation in Cambodia could also ne­ga­tive­ly affect the nation’s good image.

“I have visited factories producing for Germany and they are ve­ry well organized and I think they have relatively high labor standards,” Fischer said.

“Labor standards, and of course the general political en­vi­ron­­ment in Cambodia, are of the ut­most importance for the image of trading partners in the EU and the United States and they should al­ways be kept in mind,” he said.

Fischer acknowledged that in­creasing trade has not prompted Ger­man companies to invest in Cam­bodia.

“Corruption is a major obstacle and important cost factor,” he said.

“If there is a dispute, you have to have the possibility to go to court to get [your] rights.”

While 4.7 million pairs of shoes were exported to Germany in 2005 from Cambodia, Fischer said products like cashew nuts, organic rice and mangos also hold major potential.

Cambodia has preferential tariff ac­cess to the EU under the so-called “Everything but Arms” agreement.

 

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