CAMBODIAN goods are gaining significant traction in Vietnam, as prices for Vietnamese products rapidly increase.
The Kingdom’s exports to its eastern neighbour increased more than 84 percent in the first half of 2011, totalling US$247 million, statistics from the Vietnam Trade Office in Phnom Penh show.
“The Vietnamese economy is facing an obstacle with a rising inflation rate this year that’s been very difficult for us,” said Vietnamese Trade Attache Tran Tu.
“However, I think the government is trying its best to tackle the issue [of rising domestic prices].”
Yesterday, Vietnam’s National Assembly Economic Committee head Ha Van Hien said it would be “very difficult” for Vietnam to slow inflation to 17 percent by the end of the year. Meanwhile, Cambodia’s Minister of Economy and Finance Keat Chhon has raised Cambodia’s 2011 inflation target this week to 5.5 percent.
Cambodia’s main exports to Vietnam are agricultural products, such as seafood, corn, tobacco, rubber and cashew nuts, said Tran Tu.
Although the inflation rate in Vietnam is high, the country’s demand for goods is still high.
“I am not quite sure how much the rise of inflation has impacted demand in both markets, as I see bilateral trade keeps increasing,” he said.
Tran Tu also said the two countries are on track to achieve $2 billion in bilateral trade this year.
The figures also show Vietnamese exports to Cambodia increased 56.72 percent in the first six months, totalling $1.351 billion.
Vietnam pursues close economic cooperation with Cambodia, including numerous investment projects, which boosted the figures, said Tran Tu.
“We need to import equipment and machinery for the progress of the projects,” he said. The statistics show Cambodia’s main imports from Vietnam were chemicals, garments, steel, machinery, and plastic materials.
Last month, Commerce Minister Cham Prasidh said the government aimed to increase bilateral trade by continually easing border restrictions. ADDITIONAL REPORTING BY BLOOMBERG