Business

Silk producers look to sew up EU market ties

Fri, 25 May 2012 05:00:20 +0100

A woman weaves silk in Roka Korng 1 commune in Kandal province’s Muk Kampoul district last year. Photograph: Heng Chivoan/Phnom Penh Post

Cambodia's silk producers say they must cut costs in order to continue reaching troubled European markets, the primary target for the Kingdom’s sericulture products.

Insiders said Cambodian companies must start producing their own silk for the industry to survive.

Silk craftspeople import some 400 tonnes of silk per year from China then export finished products.

The reduction in price would come directly out of the silk

itself, Seung Kimyonn, director of the Cambodian Craft Cooperation, said this week.

Silk producers have already started adding cotton to the products, he said. Seung Kimyonn’s company, which caters to the European market, used a total of two tonnes of silk per year about two years ago.

The amount of silk used in his export products was cut in half last year.

“In the past, I produce products from 100 per cent silk, but now we are making changes in order to maintain the market,” said Seung Kimyonn, who is also a silk craftsman.

International demand for Cambodian craft products have dropped substatially as European purse strings have tightened, the Post reported earlier this year.

Seung Kimyonn’s team is designing products that will blend a significant amount of cotton, which sells for US$4 per kilogramme, compared to $50 for the same amount of silk.

There are other ways to lower the price of the country’s silk, Sisowath Pheanuroth, president of the Advisory Board for Small and Medium Industry Association of Cambodia, said.

Cambodians should reduce their reliance on Chinese silk by producing their own, he said.

“Unless Cambodia can produce silk by itself, there will be challenges for our silk products,” Sisowath Pheanuroth said.

Seung Kimyonn said his company will start to target regional tourist from China and Korea.

More Chinese firms weigh local investment

Fri, 25 May 2012 05:00:10 +0100

Six companies from China’s Guangzhou city and Guangxi province met with Kim Sithan, Cambodia’s secretary of state at the Ministry of Commerce, yesterday to discuss investment in the country
Heavy machinery, fertiliser and chemical companies expressed interest in Cambodia’s agricultural sector and said they would seek more business information about Cambodia.

Cambodia’s political and macro-economic stability and strong economic growth lured them to the Kingdom, Kim Sithan said, adding that the agricultural, garment, tourism and construction sectors would be key in Cambodia’s economic growth.

Cambodia’s open investment policy and a duty-free status in many other advanced economies were also contributing factors in the decision to invest in the Kingdom, he said.

According to data from Council for the Development of Cambodia, Chinese investment in Cambodia reached US$1.192 billion in 2011, a year-on-year increase of 71.82 per cent.

Last week, 10 memoranda of understanding were signed between China and Cambodia. The MoUs included Chinese contracts for 60,000 tonnes of rubber, 1 million tonnes of cassava, 500,000 tonnes of milled rice and 3,500 tonnes of black pepper per year, as well as processed wood and spices. Also included were Chinese imports such as processed foods, mobile phones, clothing materials and agricultural equipment.

China OKs Kingdom rice

Thu, 24 May 2012 05:01:20 +0100

Farmers transplant rice seedlings in Prek Liep commune, in Phnom Penh’s Russey Keo district earlier this year. Photograph: Hong Menea/Phnom Penh Post

After more than a year of speculation on Cambodian rice exports to China, a rice exporter this week said China has granted the Kingdom permission to ship milled rice northward.

Despite a growing stack of quasi-agreements for exports, regulatory issues have plagued the prospects of tapping one of the region’s biggest markets for rice.

A green light for exports to China would be a boon for a sector that has heard little positive news this year.

“All the administrative problems are removed. It is really good news,” Sok Hach, president of Golden Rice (Cambodia) Co Ltd, said in an email.

He declined to say how the agreement was met or when exports would start.

The company sent 48 tonnes of rice to China earlier this year but the shipment was turned away at the southern China port of Shenzhen, Sok Hach had told the Post.

The rejection was a “paperwork problem on the Chinese side” and not a problem with the quality of Cambodian rice.

Deals with China and the Philippines were quickly appearing to be a last resort to the European market, which bought a majority of Cambodia’s milled rice last year.

A flood of Indian rice onto the global market in early 2012, followed by falling prices in Thailand and Vietnam, were a shot to Cambodian millers, with insiders citing large decreases in forward orders for Cambodian rice.

The price of shipping rice to Europe climbed by 50 per cent between February and April, the Post reported last week.

A continued increase in oil prices presaged no end to further jumps in logistics costs.

Regulatory issues aside, Sok Hach said Cambodia still faced tough price competition.

Even if the Kingdom’s processing and logistics costs were on par with exporting giants such as Vietnam and Thailand, China would probably import no more than 100,000 tonnes from Cambodia this year, he said.

A Chinese delegation last week signed a memorandum of understanding with Cambodia’s Power Partner Profit Group for 500,000 tonnes of milled rice, or half of Prime Minister Hun Sen’s 2015 export goal.

The MoU was one of several such informal agreements, none of which have yet to yield true exports.

Experts agreed that China’s market had huge potential for Cambodian rice exports.

“China is the long-term market for Cambodian rice to aim at, despite the fact we would still need to work harder on rendering our competitiveness in pricing,” David Van, senior manager of business development at Mekong Oryza Trading Co Ltd, said this week.

Van gave a grim outlook for the sector last week and maintained “strong reservations” about the government-set target for 2012, some 400,000 tonnes, given the prevailing prices on the global rice market.

To contact the reporter on this story: Don Weinland at don.weinland@phnompenhpost.com

Sihanoukville port on track for stock float

Thu, 24 May 2012 05:01:10 +0100

A view of the Sihanoukville Autonomous Port. Photograph: supplied

The Sihanoukville Autonomous Port (PAS) was making every effort to speed up preparations for its listing on the Cambodian Securities Exchange (CSX), the port’s chief executive, Lou Kim Chhun, said this week.

“We feel very close to completion, and we think the listing will not be far away,” Lou said in his office in Sihanoukville, but he declined to give a precise date.

The 100 per cent government-owned business is one of two companies planning to list on the CSX this year, along with Telecom Cambodia.

The Phnom Penh Water Supply Authority listed on the exchange last month.

Lou said he felt confident in the government’s decision to list the company.

He said the decision had been considered carefully, and much has been learned by watching neighbouring countries such as Thailand and Vietnam.

The company would list 15 per cent of its stock to begin with, and would “study the situation carefully” before listing any more, Lou said.

About 60 per cent of Cambodia’s exports and imports pass through the port, with the remaining 40 per cent arriving or departing from Phnom Penh or other private ports, Lou said.

The main competition to Sihanoukville would come from Vietnamese ports, he said.

Most imports that move through the port are from China, and are mainly textiles, machinery and construction materials.

Europe and the US are the biggest importers of Cambodian goods, mostly garments, shoes and rice.

Currently, all Cambodian shipments go through nearby ports such as Singapore and Hong Kong.

Shipping directly to the United States or Europe is a goal Lou would like to see come to fruition, but he said it all depended on economic scale.

The PAS has received support from the Japanese government and the Japanese International Cooperation Agency (JICA), and work is being done to upgrade the port facilities.

On May 1, a special economic zone was created directly behind the port.

“We understand that some factories have to import and then export, so the cost is sometimes very heavy, so we can save time and money with the creation of this port,” Lou said.

Work began on the special economic zone in late 2010 and it is now ready for operations to begin.

“We want to promote investors,” Lou said.

A multi-purpose terminal, 260 metres long and 13.5 metres deep, is planned to be built soon, to be used mostly for agriculture export, while a 200 metre-long terminal is planned to facilitate the offshore oil drilling planned for 2015.

“These two new products are very important for the economic growth of Cambodia and improving the standard of living for poorer Cambodians,” Lou said.

Currently, the port employs 1,066 people and moves 237,000 containers annually, and the port has seen a seven per cent increase year-on-year increase in volume.

“This is a good opportunity for the people: they can invest, and if they invest and make a profit, that is very good for our people, which is who we serve,” Lou said.

Phnom Penh Water Supply Authority became Cambodia’s first listed company in mid-April.

The stock soared during the first few days of action but declined nearly to its initial public offering price a few weeks later. The price has since stabilised.

Lao Saroeun, the director-general of Telecom Cambodia, told the Post his state-owned company was confident with the decision to list on the exchange.

To contact the reporter on this story: Abe Becker at newsroom@phnompenhpost.com

World Bank outlook for Cambodia positive

Thu, 24 May 2012 05:01:05 +0100

The World Bank’s biannual report on Cambodia was largely positive given dire economic prospects in Europe, which economists agreed were closely tied to the Kingdom’s key export sectors.

The report, released yesterday, predicted 6.6 per cent growth in gross domestic product compared to 2011.

That’s a tenth of a percentage point higher than the bank’s 2012 estimate in November last year.

Manufacturing is predicted to slow slightly this year, but the nature of Cambodian-made clothing may dodge some fallout from the continued sovereign debt crisis in Europe, which has been compounded recently by the threat of Greece’s exit from the European Union.

“That might be very well linked to many stores in the US and EU focusing on budget garments. And Cambodia is supplying some of those garments,” senior country economist Enrique Aldaz-Carroll said yesterday during a discussion on the report in Phnom Penh.

GDP growth in 2011 was also considerably higher than the World Bank predicted in November.

The economy expanded by 6.9 per cent, up from the 6 per cent predicted at the time.

The report noted that Cambodia has benefited from a shift in labour intensive industries from China to countries with lower wage costs, but economists said the country’s capacity to absorb new investments was not guaranteed.

Cambodian industry saw signs in 2011 that production was moving up the value chain.

Several assembly factories opened last year, although continued advances in the manufacturing sector would depend on boosts in education and training, bank economists said.

Price inflation would stay within the government target of 5 per cent this year, the report predicted.

Inflation cooled to a 4.9 per cent year-on-year increase in 2011.

To contact the reporter on this story: Don Weinland at don.weinland@phnompenhpost.com

The welcome correction in commodities prices

Thu, 24 May 2012 05:01:00 +0100

The Thomson Reuters/Jefferies Index, the most widely recognised measure of global commodities markets, dropped 8 per cent in 2012, and is down 14 per cent year on year.

The index hit a high of 350 in May of 2011 and is now hovering around 289.

Petroleum-based products, which comprise 33 per cent of the index, have contributed to the steep fall in the index.

After touching US$110.88 a barrel in February, the price of NYMEX Crude Oil is currently about $9O.5 per barrel, 18 per cent below the year high.

Gold, which topped $1,918 an ounce in September, 2011, is now trading 18 per cent less at $1,555 an ounce.

The falls in silver and copper are more pronounced, silver down 27 per cent from its 52 week high, copper decreasing by 23 per cent.

The key drivers in moderation of commodity prices are slowing growth in China, the rapidly deteriorating situation in Europe, the resurrecting strength of the US dollar, the lack of further stimulus programs, and the avoidance of higher risk assets.

The main beneficiaries are the US 10 year Treasury note which reached an all-time low yield of 1.702 per cent on May 16 and the US Dollar.

The dollar index is now trading at 81, close to its 52 week high of 81.78.

The natural resource and agriculturally rich Australian economy has suffered. Its currency has weakened below parity with the US dollar, trading at .975 from an all time high of 1.1079 in August, 2011.

Brazil, the world’s largest exporter of iron ore has seen a currency depreciation of 34 per cent versus the dollar.

China, the world’s second-largest economy after the United States, has fueled the secular commodities bull market of the last decade.

With a population of over 1.3 billion people the country consumes vast amounts of resources and is the fastest-growing major economy in the world.

China is the world’s second-largest importer, the top importer of coal, the second largest importer of oil and copper.

The economy grew at 8.1 per cent in the first quarter, its weakest pace in nearly three years.

This was the fifth successive quarter of slowing annual growth placing the economy on track for its weakest full year of expansion in a decade.

The government is attempting to reverse a surge in home prices, placing curbs on the property market by requiring high down payments and enacting restrictions on mortgage interest rates and housing purchases.

As a result home sales fell 25 per cent in the first two months of 2012.

The double whammy of a downturn in the property market and the government’s policy of reducing capital spending, negatively impacting investment in roads and infrastructure by up to 25 per cent, does not bode well for improving commodity prices in the second half.

Commodities are substantially priced in dollars, the stronger the dollar, the more expensive the commodity, and thus an increased deterrent to buying.

Historically there has been an inverse relationship between the value of the US Dollar and the price of commodities.

The increased prospects of a breakdown in the Euro and the zone’s economies, continued economic growth in the US, and most of the developed world’s economies stagnant or worse, continued strengthening of the US dollar remains likely.

The downward trend in commodity prices is welcome news to consumers, especially as gasoline and food prices decrease.

Lower raw-material costs will spur corporate spending and profit margins.

With most of the world’s economies in poor shape, the correction couldn’t have come at a better time.

Anthony Galliano is chief executive of Cambodian Investment Management.
anthonygalliano@covenantim.com

SECC sets minimum capital requirement

Thu, 24 May 2012 05:00:50 +0100

The Securities and Exchange Commission of Cambodia (SECC) has set a minimum capital requirement for securities firms, in order to protect their financial soundness.

A statement from the SECC, released yesterday, said that securities underwriters are required to hold a minimum of 40 billion riel of their shareholder’s equities, and to keep on deposit guarantee money of at least 4 billion riel.

This would be 25 billion riels for smaller securities dealers, as well as keeping a deposit of 2.5 billion riel, and 6 billion riel for securities brokers with 1 billion riel of guaranteed deposit at any time.

It also requires securities firms to maintain a net capital ratio not lower than 150 per cent and required them to report on the status of the net capital of their company.

To contact the reporter on this story: May Kunmakara at kunmakara.may@phnompenhpost.com

Thai-Cambodia agricultural zones set for establishment

Thu, 24 May 2012 05:00:40 +0100

Cambodia and Thailand have agreed to set up specialised agricultural export zones along the border inside Cambodia in a bid to curb any suspension of cross-border trade from Thailand, as well as to achieve a 30 per cent increase in bilateral trade year-on-year, commerce official said.

The initiative was agreed between Cambodia’s commerce minister Cham Prasidh and Thailand’s commerce minister when they met during the Third Joint-Trade Committee in Bangkok last Sunday, according to the Thai media.

Sok Sopheak, director general of the commerce ministry said that the establishment of the zones aims to avoid any problems on the Thai side, especially during the harvest season.

“Actually, they [Thailand] buy our agricultural products not to supply their own market, they just buy from us for export to other countries,” he said. “When we have this zone in our country, they can easily come to buy from farmers to process or stock here for export —this will not impact their price at all.”

He said that the establishment of the zones located in some areas in provinces along the border— probably Ordor Meanchey, Pailin, and Banteay Meanchey, by allowing investors come and build warehouses and drying plants to eventually export to another countries via Thailand.

Ly Uttny, president of Banteay Meanchey Chamber of Commerce, said the establishment of the zone will help farmers avoid any bans from Thailand.

He said that zone will attract more investors to invest at the border for processing other agricultural products to export via Thailand.

“It can also reduce transportation for export to other countries, which is cheaper, rather than transporting from here to Sihanoukville Port— that costs them a lot because it is very far, more than 1,000 kilometres,” he said.

Sok Sopheak said both sides had already set up action plans and taskforces to speed up the process, and said they are currently conducting a joint feasibility study. “It is not an easy job. It will take about six months to one year,” he said.

“What we are trying to do now is to prepare and do some paperwork, set up regulations, mechanism and some other agreements that we can sign in order to facilitate trading smoothly. We welcome any foreign investors come to invest in our designed areas.”

He also said that with the establishment of the zone, both countries aimed to increase bilateral trade by 30 per cent year-on-year.

Trade between the two countries rose by 58.16 percent to $1.133.53 billion in the Q1 of the year compared to $716.69 million, according to the data from Thai embassy’s Foreign Trade Promotion office to Phnom Penh.

To contact the reporter on this story: May Kunmakara at kunmakara.may@phnompenhpost.com

Rail looks for new funding

Wed, 23 May 2012 05:00:40 +0100

A Toll Royal employee climbs aboard a train at Phnom Penh Railway Station in 2010. Photograph: Sovan Philong/Phnom Penh Post

It's a nearly 300-kilometre stretch of rail in disrepair. More than 60 bridges – some crumbling, some dotted with landmines at the base – lie on the line between the towns of Bat Deong, northwest of Phnom Penh, and Sisophan near the Thai border.

It’s also where about US$118 million in grants and concessional loans from the Asian Development Bank, AusAid and other donors came up short in the effort to rehabilitate the country’s railways.

“More reserves should have originally been put in place,” Peter Broch, senior transportation economist at ADB in Cambodia, said yesterday, adding that the tracks were in a poorer state than originally thought when assessments were conducted five years ago.

The shortfall, and the reportedly slow pace of progress on the line, led to the suspension on March 31 of Toll Royal Group’s operations.

The company, which has a 30-year concession for operations, has yet to issue a formal statement announcing the suspension, but a majority of the company’s staff have left the job.

Sources of funding for the remaining track are unclear, but an official at ADB yesterday said the line that would connect Thailand to Cambodia’s only deepwater port would be complete in 2015.

The search for the remaining money, which experts yesterday said could not be assessed at present, was now in the hands of the government.

“This is with the expectation that the government would be able to mobilise some sources of funding,” ADB Cambodia country director Putu Kamayana said yesterday.

“I understand that there are public and private sources looking into it.”

There’s an equal amount of speculation on Toll’s concession, which is in partnership with domestically owned Royal Group of Companies.

While ADB expects Toll to operate the 256-kilometre southern line when completed at the end of this year, Putu Kamayana also said that “we’ve heard the rumour that there are others waiting in the wings”.

No firms have stepped forward as the successor to Toll.

Touch Chankosal, a secretary of state at the Ministry of Transportation and Public Works, declined to comment yesterday on other possible companies interested in the Toll concession.

Council of Ministers spokesman Ek Tha yesterday also declined to comment on developments regarding Cambodia’s railways.

In early May, Pierre Chartier, a transportation specialist at the United Nations Economic and Social Commission for Asia, told the Post that a slowdown on Cambodia’s railways could lead to slower regional progress on both the Vietnamese and Thai sides of the track.

A functioning railroad in Cambodia would save $1 billion in road and sea transportation costs during the first 30 years of operation, according to an ADB estimate.

To contact the reporter on this story: Don Weinland at don.weinland@phnompenhpost.com

Cham move for halal food

Wed, 23 May 2012 05:00:35 +0100

Cham Muslims dry tobacco leaves in Kampong Cham province last year. Photograph: Marisa Reichert/Phnom Penh Post

Cambodian officials and Muslim leaders will meet this month to discuss the establishment of the country’s first halal food institution, which would cater to the Kingdom’s some 400,000 Muslims.

Cambodia would invite experts from Muslim-major-ity countries in the region to teach local Muslims, known as Cham, how to process food according to Islamic doctrine, Mao Thora, secretary of state at the Ministry of Commerce, said yesterday.

The institution, or centre, for Islamic food would be a state-run facility that recognised Islamic food standards, he said.

Although many of the nation’s Cham consider themselves Muslim, awareness of the rules governing Islamic eating habits was low, some members of the Muslim community said yesterday.

“If we don’t how to do it, then we are not Muslims. So we want to know how to do it,” Othsman Hassan, a local Muslim and president of the Cambodian Muslim Development Foundation, said.

“If we want to know how to make halal food, we have to seek help from Islamic people. And we need this help without spending too much money.”

One of the first steps for establishing a centre would be installing a laboratory for food testing, Othsman Hassan said.

Identifying hygiene techniques customarily used in Muslim cooking would be another part of the process, he said.

Muslims cannot eat food that contains pork or blood.

Cows that had been electrocuted could also not be consumed, Othsman Hassan noted.

Leaders of Cambodia’s Cham population have said their community is poor and often feels marginalised.

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

Trade with Malaysia up as exporters looks East

Wed, 23 May 2012 05:00:30 +0100

Bilateral trade between Cambodia and ASEAN member state Malaysia rose by 34 per cent year on year in 2011 to US$319.5 million compared to the year before, according to data from the Embassy of Malaysia in Phnom Penh released yesterday.

Experts noted the nearly 100 per cent increase in Cambodian exports to Malaysia signified a shift from dependence on Western markets.

The Kingdom shipped $65 million in crude rubber, cereal and garments, among other items, to Malaysia in 2011.

The exports represented a 95 per cent increase on the year before, statistics showed.

Recent boosts in inter-government relations accounted for an increase in confidence among businessmen and traders, director general of the Cambodian Chamber of Commerce Ngoun Meng Tech said.

“I noticed that the two governments have a very good relationship. That’s a key point for increasing trade exchanges and investment from Malaysia to Cambodia in the recent years,” he said. “It also proves that we can have more markets in the region,” he added.

Malaysia’s main exports to Cambodia last year were textiles and clothing, metal products, processed food, chemical and beverages, data showed.

After Vietnam, Malaysia is the second biggest investor in Cambodia among ASEAN countries.

Malaysia invested $235 million in Cambodia last year, a jump of 41 per cent.

Most of the investments were in garment manufacturing, real estate and rice-milling sectors.

Economists yesterday noted the increase in trade of value-added goods as a positive sign that Cambodia was beginning to look into markets in its own backyard.

“That’s a good sign for the diversification of our exports. We have mainly exported unprocessed agricultural products into many countries in the region,” Chan Sophal, president of the Cambodian Economic Association, said yesterday.

To contact the reporter on this story: May Kunmakara at kunmakara.may@phnompenhpost.com

International interest in Cambodian sugar

Wed, 23 May 2012 05:00:10 +0100

Sweet news for Cambodian palm-sugar farmers: 10 international companies are keen to import their produce, one of the Kingdom’s signature products.

Sam Saroeun, president of the Kampong Speu Palm Sugar Promotion Association, said that after an exhibition in South Korea earlier this month, several international importers had expressed interest in buying.

Kampong Speu sugar is one of the few Cambodian products that have an internationally recognised geographic indicator: a certificate that ensures the product is not made in another location.

Eight of the interested companies are from South Korea.

A Philippine and an Indian company also reportedly have plans to buy the product.

“They asked us to send an e-mail to them about prices and the palm sugar producing technique, and now we are waiting for their answer,” Sam Saroeun said.

“We believe they will buy palm sugar from us, because they said that if we ask for a fair price, then they will accept it.”

The companies had yet to specify when, or how much, of the sugar they would purchase, Sam Saroeun said.

Cambodian fish paste, known as prahok, is also protected by a geographic indicator.

Several other Cambodian products, including a number of fruits, also sought to earn the recognition this year but were constrained by processing fees, the Post reported.

It is hoped that geographic indicators will help push Cambodian specialty products on to the international market, an area to which they have had little exposure.

Last year, the association produced a total of 260 tonnes of palm sugar, but the volume would be less this year because of a late harvest, officials said.

It was unclear whether the decrease in supply would be felt by companies looking to export the sugar.

To contact the reporter on this story: Sieam Bunthy at bunthy.sieam@phnompenhpost.com

First life insurance company launches in Cambodia

Tue, 22 May 2012 05:01:20 +0100

Apsara dancers perform at the opening ceremony of the Cambodia Life Insurance Company Plc yesterday in Phnom Penh. Photograph: Heng Chivoan/Phnom Penh Post

The Kingdom’s first life insurance company, Cambodian Life, launched yesterday, courting a market almost entirely unfamiliar with the service.

Industry insiders said demand for the products would need time to grow.

The Ministry of Economy and Finance signed agreements in August with PT Asuransi Central Asia, Asian Insurance Co ltd, Bangkok Life Assurance Plc and Bangkok Insurance Co ltd to provide the services.

The company is 51 per cent government owned, the remaining ownership divided between the four insurance companies.

Chairman of General Insurance Association of Cambodia (GIAC), Chhay Rattanak, welcomed the launch, but said it would take time for the company to become profitable.

“It is a starting point. This is another step in the development of the sector and works in cohesion with many other countries in the region. I think there will be some other companies that will open soon,” he said. “I think it will take between two and three years to become successful. Success is not possible in one year because more time is needed to convince the people.”

He added that other countries in the region such as Vietnam also started with general insurance and followed with life insurance, which had taken around three years to become profitable.

The establishment of Cambodian Life in the Kingdom would develop confidence in the market and eventually attract other life insurance companies to Cambodia, said Aun Pornmoniroth, secretary of state at the Ministry of Economy and Finance.

“The establishment of Cambodian Life will create diversity in financial services for people to manage unforeseen risks in the future” he said. “Cambodia Life will operate throughout the country to provide life insurance products that will be private and voluntary and will assist in creating a social safety net.”

Cambodian Life has done its due diligence on the market, according to In Meatra, the company’s director general.

He said the company had been conducting feasibility studies into what services would be offered since 2004, and that the decision was carefully considered.

“After our feasibility studies, we had a fantastic response from businessmen and even from people who work within the informal economy,” he said. “If the response had not been so positive, we would not have proceeded with launching the business. I think these products will serve a need of the people, as the economy is growing and these services are coming into demand.”

The company will provide three main services, In Meatra said: term life insurance, whole life insurance and mortgage insurance.

The price for term and whole life insurance starts from US$5,000 while mortgage insurance starts from $1,500.

To contact the reporter on this story: May Kunmakara at kunmakara.may@phnompenhpost.com

Standards out for tourism officials

Tue, 22 May 2012 05:01:10 +0100

A tourist poses for a photograph at Angkor Wat, in Siem Reap province, earlier this year. Photograph: Sreng Meng Srun/Phnom Penh Post

Housekeeping and front offices at hotels around Cambodia are set to change as the country prepares to adopt regional standards that all ASEAN nations are trying to put in place.

The draft document on housekeeping and front-office standards, and related training courses, had been finalised by Tourism Ministry officials, Try Chhiv, director of the National Committee for Tourism Professionals, said.

The committee would wait until July, when ASEAN officials send copies of ASEAN’s standard documents, in order to ensure uniformity, he said.

The documents, implemented by trainers, trainees and employers, would become the standard for evaluating professional staff, Try Chhiv said yesterday.

Tourism Minister Thong Khon said the preparation of services in compliance with ASEAN standards was crucial for Cambodian tourism.

“I want Cambodia to go along with ASEAN,” he said.

Thong Khon said Cambodia did not yet have state-run professional schools for training, but staff were trained by private-sector partners.

Cambodia’s tourism sector employed about 400,000 people and would need twice that number by 2020, Ang Kim Eang, president of the Cambodia Association of Travel Agents, said.

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

Malnutrition affecting Cambodia’s development

Tue, 22 May 2012 05:01:00 +0100

A 50 per cent stunting rate among Cambodian children contributed to lower-skilled labour and slower economic development for the Kingdom, a senior government economist said yesterday at a workshop on food security.

Stunted growth as a result of malnutrition led to ineffective learning among children and low work productivity among adults, Mey Kalyan, a senior adviser on the Supreme National Economic Council, said.

Stunting was pervasive, and not only among poor families, he said.

The condition also resulted in a smaller stature and early death.

“Being small is not special to Cambodian DNA. We can improve,” he said in a report.

Relieving the country of the “vicious cycle” of malnutrition could raise Cambodia’s gross domestic product by up to three per cent, Mey Kalyan said, citing reports by other economists.

While Asian Development Bank traditionally focuses on gaps between education and the work force, the bank’s 2012 outlook for Cambodia specifically mentioned Cambodia’s nutrition shortfall as a threat to developing a skilled labour force.

“Normally, when you think of skill development, you think of vocational training. But [nutrition] is actually a critical part of this,” ADB deputy country director Peter Brimble said yesterday. “It’s how wide you want to spread your net when you’re talking about skills.”

Along with boosts throughout the education sector, the ADB report said improvements in early childhood nutrition could provide a firmer base for skill training.

Malnutrition and stunting was at the base of a dour assessment of Cambodian education and labour.

About 63 per cent of youth are out of school, and 93 per cent don’t complete secondary school, Mey Kalyan said.

“Because of these factors, our labour forces are not productive and competitive,” he said.

To contact the reporter on this story: Don Weinland at don.weinland@phnompenhpost.com

Capital port delayed until early next year

Tue, 22 May 2012 05:00:50 +0100

Quashing hopes of opening the Phnom Penh Port for the high trade season that begins in July, the port’s director said the pace of construction would push the official launch date into next year.

If the speed of construction was inceased in order to open before the high season, there could be an impact on the quality of operations later, port general director Hei Bavy said.

He said the actual launch would be at the end of this year or early next year.

The delay would not have an impact on business because the capacity of the existing facilities had been enlarged in preparation, Hei Bavy said.

The US$28 million port, in the Keansvay district of Kandal province, will be able to load 120,000 containers (TEUs) a year.

Construction began in early 2010 and it was 90 per cent completed, Hei Bavy said.

Nor would the delay affect the transportation of goods in Cambodia because of the existing port and the Sihanoukville port, Sin Channy, the director-general of Linehaul Express, said yesterday.

Sin Channy said he supported the delay.

The Cambodia Freight Forwarders Association has 27 member companies that use the Phnom Penh Port for as much as 30 per cent of their transportation.

Cargo via the Phnom Penh Port increased by 11 per cent in 2012 to 17,386 TEUs from 15,652 TEUs last year, according to port statistics.

To contact the reporter on this story: Sieam Bunthy at bunthy.sieam@phnompenhpost.com

Visitors from Vietnam up 18 per cent in Q1

Tue, 22 May 2012 05:00:40 +0100

The number of Vietnamese tourists visiting Cambodia and Cambodians visiting Vietnam has increased recently, according to new data released by the Cambodian tourism ministry.

Vietnam has the largest number of tourists visiting Cambodia at 600,000, or 21 per cent, of all international visitors.

In the first quarter this year there was an 18 per cent increase in the number of Vietnamese tourists compared to the same time last year, said Thong Khon, Cambodia’s tourism minister.

“Most Vietnamese tourists who come to Cambodia visit Angkor Wat and many report that they like Cambodian fish and enjoy visiting Cambodian markets,” said Thong Khon.

The Cambodian tourism ministry estimates that the number of Cambodians visiting Vietnam has increased by 30 per cent annually over the past several years.

“About 420,000 Cambodians visit Vietnam annually, and many go there for health care,” said Thong Khon.

He said the ministry is very interested in increasing tourism between not only Vietnam but especially other nearby ASEAN nations.

“We have a lot of projects to increase tourism in the region,” he said.

Laos, Myanmar and Vietnam held talks on the subject at the 8th International Travel Expo in Ho Chi Minh City from September 14 to 17 last year, and the Cambodian tourism ministry plans to attend another from the September 13 to 15 this year, he said.

Vietnam and Cambodia now have a cross-border transportation agreement under which 19 companies have licences to operate.

Thirty-nine trips with 300 buses travel to and from Ho Chi Minh and Phnom Penh every day, according to the Cambodian tourism ministry.

Recently another luxury bus service, offering six trips a day to Phnom Penh from Ho Chi Minh City, has been launched by the Cambodian tourism ministry and NagaWorld Group.

To contact the reporter on this story: Abe Becker at newsroom@phnompenhpost.com

MoUs to tighten Chinese trade ties

Mon, 21 May 2012 05:01:20 +0100

A man walks in a shipping container area at Yangshan Port of Shanghai earlier this month. Cambodia and China plan to double bilateral trade to US$5 billion by 2015. Photograph: Reuters

Cambodia’s Power Partner Profit Group has signed 10 memoranda of understanding with Chinese companies for cooperation on agriculture, mineral resources and electronics.

Insiders said the penning of the MoUs, which do not guarantee a final agreement, was another step toward realising a US$5 billion bilateral trade goal reached by Prime Minister Hun Sen and Chinese President Hu Jintao in April.

The domestically owned firm signed the MoUs on Friday without announcing a specific value of the deals should they be followed through.

The potential deals would focus mainly on agriculture, namely contracts for 60,000 tonnes of rubber,

1 million tonnes of cassava, 500,000 tonnes of milled rice and some processed foods, Yim Sawy, PPP Group president, said on Friday.

Deals would also look at Chinese mobile phones produced in Cambodia – which now don’t exist – clothing materials and agricultural equipment, Yim Sawy said.

“China has a huge demand for agricultural products. And at the same time, Cambodia has a great potential for agricultural products,” he said. “These MoUs will help in Cambodia’s goals for proverty reduction and job creation for our people. They will help find markets for their products.”

A wide range of Chinese companies joined in the signing.

Yunnan Yun Manganese Group inked MoUs on minerals, water resources, electricity and real estate. Sichuan Jingong Chuangpai Flavoring looked into fish, chicken and shrimp seasoning.

“I suggest local investors cooperate with PPP Group if they want to export their rubber,” Yunan Yun Manganese Chairman Li Yong Seng said on Friday.

“We see the Cambodian government is very careful with foreign investors like China, and that builds the confidence needed for more investors to come here.”

Bilateral trade between Cambodia and China reached $2.49 billion last year, a 73 per cent increase on the year before, according to data from the Chinese Embassy in Phnom Penh.

Cambodia’s exports to China, totalling about $184 million, constituted only a fraction of the total trade but increased by nearly 100 per cent compared to 2010.

Serie Kosal, vice chairman of Cambodia’s One Village One Product National Committee, a government project that supports local products, said the MoUs were a sign of strength in the bilateral trade relationship, and should help reach the goal of $5 billion in bilateral trade by 2015.

He added that the country’s political stability had played a role in attracting the Chinese investors.

Vijit Yang, Chairman of the ASEAN-China Economic and Trade Promotion Association, said on Friday that the MoUs would draw closer business ties.

“We are going to get Cambodian cassava, rubber and agriculture products into the Chinese market. I will bring more Chinese investors to Cambodia,” he said.

To contact the reporter on this story: May Kunmakara at kunmakara.may@phnompenhpost.com

Fisheries administration working to restore lobster market

Mon, 21 May 2012 05:01:10 +0100

A lobster salesman earlier this year in Takeo province holds his product near the river in which it was caught. Photograph: Abe Becker/Phnom Penh Post

The government and international organisations are working to restore Cambodia’s once plentiful freshwater lobster market, officials have said.

Technically a freshwater shrimp, the crustacean is a popular foodstuff in the Kingdom, selling for up to US$10 for a single lobster.

Efforts are being made by the Fisheries administration to provide technical assistance on the farming and hatching of the lobsters and the Japanese International Cooperation Agency (JICA) has provided financial assistance to farmers since 2006, acccording to the JICA website.

They have trained 70 farmers nationwide and currently most farms are situated in Kampong Speu, Kampot, Takeo and Prey Veng provinces.

The centre for research and freshwater aquaculture of the fishery administration has hatched about one million lobsters, which is a step toward their stated goal of releasing seven million lobsters into the wild to boost numbers said Sam Narith, deputy director of the centre.

“Releasing young lobsters in the wild rivers is very important to increase livestock because lobsters are decreasing,” Sam Narith said, adding that “if we don’t do it, production will be less and less in the future”.

The lobster population has decreased drastically during the past 10 years, officials have told the Post.

Lobsters have been found in the current market to be 10 to 20 times more profitable than farming fish on the same amount of land.

Yan Dee, a lobster farmer in Takeo province has a seven-hectare farm and says he can usually produce around 70 kilograms of lobster per pond.

“Now I can deliver about 100 kilos of lobster to Phnom Penh alive every two weeks,” Dee said.

He reports he produces very nearly a tonne of lobsters a year, which he considers to be about one-tenth of total production in Cambodia.

Om Savath, director of the fishery alliance coalition team said that illegal fishing is still a concern for the fisheries sector, because there was a large increase in illegal fishing from March to April compared to the same time last year.

Om Savath said there are reports of corruption, bribery and misunderstanding of the law among fisheries officials that puts the future viability of the lobster in some doubt.

“Officials should crack down on illegal fishing actively, and they should continue to educate fishers not to use illegal fishing tools,” said Om Savath.

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

Crocodile farmers feel bite as demand continues to fall

Mon, 21 May 2012 05:01:00 +0100

The price of crocodile hatchlings in Siem Reap province has dropped drastically, and many local farmers are worrying about the future viability of crocodile farming.

Tim Bunseng, a crocodile farmer in Siem Reap with around 200 female hatchlings, said the price he can get has dropped from US$23 to $24 to $17 in less than a week.

Tim Bunseng speculated that the price will drop further because more hatchlings will be on the market soon, adding that he has only sold about 200 hatchlings this year, while last year he sold more than 2,000.

Tim Bunseng said that eggs are laid once a year and the eggs start hatching from April to August and that most of the hatchlings are exported to sell in Vietnam.

Chou Sedavuth, a crocodile farmer in Siem Reap and a buyer exporting crocodile hatchlings to Vietnam, said that the price is currently decreasing because of a drop in purchases.

“I am worried because the price continues falling as we compete to sell [hatchlings], causing Vietnamese buyers cut down their buying to lower the price,” he said.

Chou Sedavuth said that up until now, he had exported about 6,000 crocodile hatchlings to Vietnam.

A fisheries official, who has asked not to be named, said that the number of exporters buying up hatchlings has dropped significantly, in turn causing the price to drop.

Siem Reap, he said, has more crocodile farms than any other province, with approximately 300.

In order to stabilise the market the Ministry of Agriculture is urging farmers to raise crocodiles for skins rather than selling them as hatchlings to Vietnam, he said.

Crocodile farmers have reported falling prices since mid- to late-2011, when they blamed flooding for the decrease in the price of the animals.

To contact the reporter on this story: Sieam Bunthy at bunthy.sieam@phnompenhpost.com