A roadshow to Hong Kong this week to pitch Cambodia’s newly received duty-free access on travel goods to the US market was successful, but manufacturers have yet to sign concrete deals to establish new production lines here, a delegate of the returning business mission said.
US ambassador to Cambodia William Heidt said the Cambodian delegation met nearly 20 international buyers and 20 travel-goods manufacturers during the two-day trip, including Li & Fung, a global supply company that manages top US and European Union brands.
He said that while investors showed interest, they would need to spend time studying Cambodia’s market potential before committing to any projects.
Commerce Minister Pan Sorasak led the delegation, which also included officials from the Garment Manufacturers Association in Cambodia (GMAC).
The investor presentation aimed at promoting Cambodia’s preferential treatment under the revised US Generalised System of Preferences (GSP) scheme that allows Cambodian-made travel goods such as luggage, backpacks and wallets to be imported duty-free by US buyers.
Heidt said three companies with factories in Cambodia had already responded to the opportunity by expanding their production lines – a move that could create an additional 5,000 local jobs. Another five companies “showed serious interest” following the Hong Kong presentation.
“I support Cambodia’s strategy very strongly,” Heidt said. “They are not sitting around and waiting, but actively looking to recruit investment.”
While Cambodia was one of just two countries in the Asia-Pacific region to be granted a tariff exemption on travel goods on July 1, US trade officials previously have said that scheme could be granted to neighbouring countries, especially as American buyers look to diversify away from mainland China.
Heidt said that the Cambodian delegation had invited the investors it met in Hong Kong to visit the Kingdom to explore the market potential in mid-November. “We are going to be getting a big delegation of from Hong Kong to come and visit Cambodia,” he said.
Cambodia’s share of the travel-products market remains small, but has grown impressively in the last five years. Total exports were just $240,000 in 2011, but topped $48 million last year.
However, GMAC chairman Van Sou Ieng previously told the Post that Cambodia was well positioned to shift from the traditional garment sector to more higher-value added travel goods.
He said 15 manufacturers in Cambodia currently produce eligible travel goods, and estimated that the revised GSP scheme could push exports to $200 million annually, adding 100,000 new jobs.