Cambodia's exports to Japan hit $667.925 million in the first seven months of 2022, rising by 11.75 per cent year-on-year from $597.715 million, as Tokyo provides a major concessional loan for an expansion of the Kingdom’s flagship deep-sea port, and growing investment paves the way for the consolidation of Cambodian goods on the Japanese market.
In the January-July period, bilateral trade between Cambodia and Japan was to the tune of $1.138 billion, up 16.18 per cent year-on-year from $979.115 million, of which the Kingdom’s imports stood at $469.601 million, up 23.1 per cent from $381.401 million, according to the General Department of Customs and Excise of Cambodia (GDCE). The Kingdom’s trade surplus with Japan narrowed by 8.32 per cent from $216.314 million to $198.324 million.
Major items that Cambodia exports to Japan include garments, footwear, agricultural products, and general components. Key imports comprise agricultural and other machinery, vehicles, and electronics.
Hong Vanak, director of International Economics at the Royal Academy of Cambodia, told The Post on August 18 that burgeoning local and foreign investment in the Kingdom has led to more Cambodian products on the Japanese market, especially agricultural and textile-linked items.
Although highlighting the nearly one-quarter increase in imports from Japan, Vanak also noted that exports to the Japanese market are seen as a significant source of revenue for Cambodia, and that they accounted for a remarkable share of total exports in the first seven months of this year – or 4.85 per cent of $13.770 billion, making the East Asian country the third biggest buyer of Cambodian goods during the period after the US and Vietnam, according to the GDCE.
In addition to maintaining good bilateral relations, the two countries are also signatories of the world’s largest trade pact, the Regional Comprehensive Economic Partnership (RCEP), which creates special customs conditions and opens up more opportunities for goods exchanges, he stressed.
“Given all the aforementioned circumstances, I’m optimistic that the trade value between the two countries will continue to grow steadily and sustainably,” he predicted.
“Buoyed by government efforts to introduce a series of new strategies to attract investors as well as boost production capacity and quality of local products, along with the participation of the private sector, the value of Cambodia’s exports to international markets, including Japan, will witness large increases,” he added.
At a meeting with Prime Minister Hun Sen on August 6, Japanese foreign minister Yoshimasa Hayashi vowed that Tokyo would strive to further strengthen cooperation with Cambodia, and encourage more Japanese investors to enter the Cambodian market, according to a statement posted on the premier’s official Facebook page. Hayashi was in the Kingdom for the 55th ASEAN Foreign Ministers’ Meeting.
In response, Hun Sen hailed the good relations between the two countries and thanked the government and people of Japan for recently providing a 41.388 billion yen ($306 million) concessional loan to expand the Sihanoukville Autonomous Port, Cambodia’s main port for shipping merchandise to international markets, the statement recapped.
According to the National Bank of Cambodia (NBC), Japan is the fifth biggest investor in Cambodia after China, South Korea, Singapore and Vietnam. Japanese investors in the Kingdom largely operate in industry, banking, hotels and tourism, construction and real estate, and especially supermarkets and retail, restaurants and services.
Last year, Cambodia-Japan trade totalled $1.734 billion, up 1.21 per cent over 2020, with exports to Japan clocking in at $1.094 billion, up 2.95 per cent, and imports $640.513 million, down 1.63 per cent, according to the GDCE. The Kingdom’s trade surplus with Japan expanded 10.2 per cent to $453.116 million.