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ASEAN economic community good for Cambodia

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Hidetoshi Nishimura, executive director of the Economic Research Institute for ASEAN and East Asia, speaks in Phnom Penh earlier this week. Photograph: Vireak Mai/Phnom Penh Post

Hidetoshi Nishimura, executive director of the Economic Research Institute for ASEAN and East Asia (ERIA), sat down with the Post’s Rann Reuy to talk potential moves for ASEAN ahead of the implementation of the ASEAN Economic Community in 2015 (AEC).

ERIA’s activities mainly focus on research, what challenges do you see for Cambodian goods in the 2015 ASEAN Economic Community?
Cambodia, I think, is the youngest tiger in this region and its geographic situation makes for a very important asset as the system is liberalised. Cambodia has also very strong political and economic growth commitments. The most important thing is human resource development and connectivity. They (Cambodians) should not limit their thinking of all countries to goods, we can invite and we make power connectivity. That means we have ASEAN production networks.

Cambodia is facing a labour shortage, despite the current interest in investment here. How do you view this problem?
Labour mobility is now in different stages of discussion. Traditional ideas – for example in the EU – has people leave their hometowns and go crossing the border to work in different countries. But while the production network is established, production itself will be fragmented. It’s not necessary where people go to work, production must go to the best places.

Don’t worry about this issue, first a government makes the best investment situation and then the production networks come to rural areas. But in order to make that, electricity prices must be reduced.

You referred to the ‘best investment situation’. What exactly do you mean?
The most important thing for an investment situation is transparency and the next is electricity. Without electricity, it is impossible to produce anything, so in this case it is very important.

How do you think the government should handle workers striking for increased salaries?
Every worker has a right to appropriate payment, so the important thing is what goes on before going into this kind of conflict. I think there needs to be a kind of discussion, a sharing of information and a shared commitment to increase and share in the profit.

The important thing is consultation, sharing information and transparency.

Compared to other ASEAN nations, Cambodia’s per capita income is still low. What problems will we face when the AEC takes effect in 2015?
Based on our ERIA’s long-term focus, in at least 10 years, the Cambodian GDP will be double or maybe more. ASEAN as a whole is increasing by up to double of its GDP. It is very difficult to stay poor. It is impossible for your country to stay poor.

To contact the reporter on this story: Rann Reuy at reuy.rann@phnompenhpost.com

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