The spread of Covid-19 has brought a slew of challenges for the world, but also created huge opportunities, requiring all Eurasian leaders to join hands in the pandemic fight and to bolster investment and trade relations for the common interest, according to Prime Minister Hun Sen on November 24.
The prime minister was speaking via video link at the 1st Asia-Europe Economic and Business Forum (AEEBF1), a side event of the virtual 13th Asia-Europe Summit (ASEM13), which the Kingdom is due to host from November 25-26.
The themes for the AEEBF1 and ASEM13 are, respectively, “Transitioning to a New Normal: Leveraging Global Value Chains, Multilateralism and the 4IR [Fourth Industrial Revolution]” and “Strengthening Multilateralism for Shared Growth”.
Hun Sen listed some of the challenges as: the decline of global value and production chains, the emergence of a multipolar international system and geopolitical tensions, an upsurge in social inequality and poverty, greater and faster momentum in factory relocation caused by fallout from ongoing trade and tech wars, and increasingly dangerous threats posed by climate change.
“We all know very well that Asia-Europe cooperation has contributed significantly to the strengthening of the people-to-people and economic ties for the common development.
“At the same time, this cooperation still holds more potentials that we need to capture to promote socio-economic development of Asia-Europe.
“International trade is a key locomotive for promoting economic growth and job creation. With the new trend of changes in trade and global supply chains, I am of the view that both regions need to pay more attention to supporting [the] multilateral trading system,” he said.
Political leaders must place a greater emphasis on “the removal of trade and investment barriers so as to capture the potentials of Asia-Europe trade cooperation”, in furtherance of “liberalisation and trade facilitation”, he noted.
European Chamber of Commerce in Cambodia (EuroCham Cambodia) chairman Tassilo Brinzer remarked that Eurasian leaders would finally be able to attend ASEM13, after Covid-related delays.
He told The Post on November 24: “The ASEM13 is finally coming to Cambodia, and although laden with delays and the Covid-19 burden, I am glad that this event and the side events, such as the [AEEBF1] held today, on the 24th of November, and two related EuroCham Cambodia events, are held now.”
He noted that the events come as the Kingdom begins to emerge from the pandemic, “just as regional trade agreements such as the RCEP [Regional Comprehensive Economic Partnership] or the China-Cambodia FTA become effective in January 2022, and just as Cambodia chairs ASEAN next year”.
“Even with all the delays, the event is held and is a good exit to the year 2021.”
Anthony Galliano, the CEO of financial services firm Cambodia Investment Management Co Ltd, said that although the EU bloc is ranked the Kingdom’s third biggest trade partner, trade in goods between the two partners was just €4.3 billion ($4.8 billion). He did not provide a timeframe for reference.
As single country trading partners, the US (30.1 per cent of the global total), Singapore (14.8 per cent), China (6.1 per cent) and Japan (six per cent) are Cambodia’s largest, according to Galliano.
In continental rankings, he said, 40.1 per cent of the Kingdom’s exports by value were delivered to Asian countries while 34.7 per cent was sold to importers in North America, and 23.4 per cent worth of goods to Europe.
Trade with the US is surging, as exports to the North American market climb 27 per cent year-on-year, accounting for approximately 40 per cent of Cambodian exports this year, he said.
“Therefore there is substantial room for improvement in bilateral trade with [the] EU bloc. The 13th ASEM Summit positions the Kingdom in the spotlight as host and is an excellent opportunity for Cambodia to promote its image, especially in the areas of economic development and prosperity, poverty reduction and income distribution, and peace and stability,” Galliano said.
According to the prime minister, Eurasian countries account for about 65 per cent of the global economy, and around 55 per cent of global trade while the EU was Cambodia’s largest trading partner in 2018, accounting for 45 per cent of the Kingdom’s exports that year.
Most of those exports (95.7 per cent) entered the EU market under Everything But Arms (EBA) tariff preferences, the European Commission (EC) reported. Overall, Cambodia was the second largest user of EBA preferences, behind only Bangladesh, it said.
However on August 12, 2020 the EC partially withdrew the EBA scheme from Cambodia. The suspension affects one-fifth or €1 billion of the Kingdom’s annual exports to the EU’s 27-nation bloc.
Hun Sen added: “As Covid-19 crisis is expected to subside in the near future, promoting the normalcy of trade flow, business and investment corresponding to the new global trends is an essential and urgent task to revive and enhance the socio-economic development of Asia-Europe.”