Logo of Phnom Penh Post newspaper Phnom Penh Post - 2021 Korea trade tops $965M

2021 Korea trade tops $965M

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Stacks of containers at a port in South Korea’s southeastern city of Busan on October 26. YONHAP NEWS AGENCY

2021 Korea trade tops $965M

Bilateral trade between Cambodia and South Korea reached $965.132 million last year, a 9.015 per cent surge from $885.322 million in 2020, according to data from the Korea International Trade Association (Kita).

In 2021, Cambodian exports to South Korea amounted to $341.503 million, up by 7.353 per cent year-on-year from $318.112 million, while imports clocked in at $623.628 million, rising by 9.947 per cent from $567.210 million in 2020.

Cambodia’s trade deficit with South Korea widened by 13.258 per cent from $249.099 million in 2020 to $282.125 million last year.

Last month alone, bilateral trade was to the tune of $95.395 million, a 10.966 per cent uptick from $85.968 million in December 2020. Of that, Cambodia’s exports amounted to $32.439 million, rising by 23.916 per cent from $26.179 million, and imports clocked in at $62.955 million, up by 5.295 per cent from $59.789 million.

Cambodia Chamber of Commerce vice-president Lim Heng told The Post that these positive results stem from the constructive cooperation between the governments and peoples of the two countries.

He commented that the number of Korean investors in the Kingdom is increasing, in a trend likely to be cemented by the Cambodia-Korea Free Trade Agreement (CKFTA) signed by the two countries last year that is due to enter into force soon.

The trade deal will eliminate tariffs on a wide range of Cambodian goods, and encourage Korean and other foreign investors to consider setting up shop in the Kingdom and export finished products to South Korea, he said.

The CKFTA will provide more than 10,000 Cambodian goods duty-free access to South Korea, according to the Ministry of Commerce.

Under the deal, coupled with the Regional Comprehensive Economic Partnership (RCEP), the Kingdom will lift tariffs on 93.8 per cent of goods traded, with South Korea scrapping duties on 95.6 per cent, Yonhap News Agency previously reported, citing the South Korean trade ministry.

Hong Vanak, director of International Economics at the Royal Academy of Cambodia, called on the Kingdom to strive to further strengthen its production capacity for export to South Korea, to contain its trade deficit with the East Asian economic powerhouse.

He underscored that the CKFTA is sure to propel trade between the two countries, and that Cambodia is keen to beef up its exports.

“Cambodia must spare no effort to identify new products to export to the Korean market. The Kingdom is recognised for its diverse skilled labour force and lands that are conducive to agriculture,” he said, noting that agricultural goods would be a major source of exports to South Korea.

The Senate on January 6 unanimously passed a draft law authorising the ratification of the CKFTA.

The trade deal will enter into force 60 days after the commerce ministry and its South Korean counterpart have notified each other that their respective internal procedures have been completed, as affirmed by ministry spokesman Pen Sovicheat.

The Kingdom attracted a total of $39 billion of new inward foreign direct investment (FDI) in the first half of 2021, with South Korea ranking as the second largest source of registered FDI with $4.1 billion, behind only China ($17.3 billion), according to data from the Council for the Development of Cambodia.

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