Unilever Launches Local Subsidiary, But Not Factory Plans

In what Commerce Minister Cham Prasidh called “the first positive signal” from the private sector since Cambodia was approved to join the World Trade Organization, the multinational company Unilever launched a local subsidiary Wednesday night at the Inter-Continental Hotel.

“The fact that Cambodia was admitted to the WTO means a lot,” Cham Prasidh told a roomful of businessmen, government officials and reporters. “It is a seal of approval that the reforms the government is undertaking are being well-received.”

Unilever, which sells products such as Lux soap, Lipton tea and Sunsilk shampoo, entered the Cambodian market 10 years ago. It decided to open a company here to fine-tune its products to local tastes and take advantage of planned tariff reductions in the Asean Free Trade Area, its chairman said.

“We wanted to get in close to the consumers,” said Hubert Van Iwaarden, chairman of Unilever (Cambodia) Ltd.

Though Cham Prasidh encouraged Uni­lever to consider opening a factory here, Van Iwaar­den said the company had no immediate plans to do so. But, he said, now that they have a local company Unilever would be “more likely to open a factory here.”

The company hopes that it “directly or indirectly” employs 150 people next year. Its business manager, Dina Sin, refused to say what percentage of the market Unilever controls for the products it sells.

Dina Sin also said that since Unilever im­ports all of its products, the WTO will not affect it much.

Sok Hach, director of the Economic Insti­tute of Cambodia, agreed with Cham Prasidh that since the country was approved to join the WTO, the prospects for investment have improved. He said two or three garment factories have opened recently.

“It’s not much, but it’s better than before,” Sok Hach said. “It’s like a head that always falls down. Now it’s moved up a little.”

In his speech at the launch, Van Iwaarden promised that Unilever would be a good corporate citizen.

“We will pay all official taxes and levies on the imports and sales of our products,” he said. “We will be sensitive to the environmental conditions and adhere to quality standards that surpass local regulations.”

Finance Ministry officials said Monday that many major companies have not paid the value added tax.

If those companies do not pay taxes owed to the government by Nov 20, Finance Minister Keat Chhon warned that their property will be confiscated, bank accounts frozen, import-export operations halted and business licenses canceled.

 

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