A pledge in mid-June by Cambodia and Vietnam to increase bilateral trade by more than US$2.5 billion by 2015 may lead to decreased trade with Thailand, market analysts have said.
The pledge made by Cambodian Prime Minister Hun Sen and his Vietnamese counterpart Nguyen Tan Dung for $5 billion in total trade between the two nations reflected a similar Sino-Cambodian trade goal set in early April.
Cambodian exports to Vietnam increased more than 57 per cent in the first quarter this year compared to last year, as farmers looked for alternative destinations for products that went to Thailand last year.
The Kingdom’s exports to Vietnam, being primarily agricultural, were worth $201.5 million, up from $127.7 million, between January and March last year, according to data from the Vietnam Trade Office.
Decreasing orders from Thailand this year drove Cambodian farmers to look for new markets, many of which were found in Vietnam, said Chan Nora, Secretary of State at the Ministry of Commerce.
Thai restrictions on Cambodian products such as cassava were also reported this year. Instability in the Cambodian market was caused by the shift to Vietnam, but new trade deals with China are expected to combat the instability, Chan Nora said.
Cambodia’s main exports to Vietnam were seafood, corn, tobacco and rubber.
Cambodia has a very high export potential for Vietnam, but “we must understand consumers’ taste and produce suitable products”, Kao Sieu Luc, general director of Vietnam-owned ABC Bakery, said.
ABC Bakery’s revenue increased more than 40 per cent year-on-year he said.
ABC Bakery plans to build an industrial bakery in Cambodia.
To contact the reporter on this story: Abe Becker at [email protected]