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Kingdom becomes top bicycle supplier to EU

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EU top-10 bicycle suppliers in units. Phnom Penh Post

Kingdom becomes top bicycle supplier to EU

Cambodia became the largest bicycle supplier to the European Union (EU) last year, overtaking Taiwan, which had held the number one spot for two decades, a recent report from the website Bike-EU.com said on Monday.

The report from the leading industry newsletter associated with the site said Cambodia exported more than 1.42 million bicycles last year – an increase of nine percent from 1.29 million bicycles in 2016.

Taiwan – the number one supplier of bicycles to the EU for 20 years – saw a 15 percent year-on-year decline as export numbers fell from 1.56 million bicycles in 2016 to 1.31 million last year.

Cambodian Ministry of Commerce spokesman Seang Thay said on Tuesday that the Kingdom’s bicycle production has gradually shifted from just importing components for assembly to an industry making more local products.

The move has allowed Cambodia to export bicycles to the EU duty-free under the Everything But Arms (EBA) preferential scheme.

“Becoming the biggest supplier means our reputation as a bicycle exporter is much better on the international stage. This will help us to get more orders so we can boost production and create more jobs for our people,” he said.

Bicycles need to comprise a minimum of 30 percent local components in order to qualify for duty-free status in the EU, according to rules laid down in 2014, although goods from Asean can also count as local content in some cases.

Almost all bicycle manufacturers in Cambodia hail from Taiwan and still have their head offices there. Thay said there are five manufacturers in Cambodia and all are located within a special economic zone.

The director of the Center for Policy Studies, Chan Sophal, on Tuesday said it is good news for Cambodia to be in the top spot for exporting bicycles to the EU.

It shows diversification in the country’s export sector, he said, one dominated by garments and textiles.

However, he warned that the Kingdom needs to strengthen its manufacturing to produce more local content and value-added from the industry.

“The amount of value-added by the bicycle industry is very important. We hope that when the market scale grows, it will incentivise the creation of more local products,” he said.

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