PM Urges Asean to End Duties on Poor Nations

Pledging to make economic development a priority for the new government, Prime Minister Hun Sen on Tuesday urged Asean members to eliminate tariffs on Cambodian exports from all sectors by 2004.

He added that a zero percent tariff rate should also be extended to Laos, Burma and Vietnam.

“I strongly believe that such an extension will stimulate the expansion of trade across our entire region and even beyond,” Hun Sen said at the opening ceremony of the 35th Asean Economic Min­isters Meeting in Phnom Penh.

Cambodia, which belongs to the category of “least developed” Asean members along with Laos, Burma and Vietnam, is granted lower tariffs on many of its exports to other Asean members under a plan called the “Asean Integration System of Preferences”—a measure that attempts to make the four countries more competitive in the regional market. Under the plan, tariff agreements are made on a bilateral and voluntary basis for specific products.

Hun Sen said the zero rate goal would increase investment, particularly in the weaker, production-based Asean members.

Hun Sen said the government in the last five years had presided over an average economic growth rate of 6.7 percent per year. He added that the government had kept inflation low and the ex­change rate stable. According to a report last month by the Cambo­dia Development Resource Insti­tute, the value of the riel has hovered between 3,920 and 4,040 per US dollar during the past year.

Asean trade data shows that the value of Cambodian exports rose to $436.8 million in the first quarter of 2003, up 12.1 percent from $389.6 million in the year-ago period.

In the full year of 2002, it jumped to $1.9 billion, up 28.2 percent, from $1.5 billion in the previous year. But that figure showed Cambodia lagging behind seven other Asean countries, including Burma and Brunei. Data for Laos and Vietnam were not available.

Hun Sen on Tuesday also urged for the development of a “Made in Asean” brand of products, which would see product parts manufactured in various member countries. Those parts would then be transported tariff-free to other Asean countries for assembly.

“The Asean as a whole will be enabled to produce finished products that are able to face increasingly stiff world competition,” he said.

About 400 delegates are participating in the Asean meeting.

Cambodian officials on Monday declined to disclose the cost of hosting the meeting, saying they would have a better estimate of the cost after it was finished on Thursday.

During the three-day gathering, ministers will discuss a proposed Asean-China Free Trade Area, which they plan to complete within 10 years. They will also meet with delegates from Australia, Japan, India, South Korea and New Zealand.

After a day of closed-door meetings, the ministers released a joint statement, repeating their optimistic outlook for foreign direct investment flows and trade.

But, they said, in the first quarter of 2003, Asean trade with India, the US and Canada had declined. Trade with India fell 50.2 percent, while trade with the US slipped 5 percent and Canada 2.5 percent. They said trade with China, however, had risen 30.3 percent and trade with

They added that the US, the European Union, Japan, China and South Korea remained the region’s largest trading partners.

Ministers on Tuesday night met with King Norodom Sihanouk and Queen Norodom Monineath at the Royal Palace.


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