Global downturn hits trade, with flagging construction imports accounting for the bulk of the losses since January
A freight ship docks at the Phnom Penh Port awaiting a consignment of cargo in this file photo. A global slowdown in trade has hit heavily Cambodia’s two main shipping terminals.
CARGO shipments at Cambodia's second-largest port have declined sharply in the first two months of the year as global trade slows, say port authorities, adding that hundreds of jobs have also been axed in the downturn.
The Phnom Penh International Autonomous Sea Port reports a 30 percent drop in throughput, largely due to falling imports of construction materials, officials told the Post Wednesday.
"The decline is caused by the global financial storm that started to hit at the end of last year. This affected not only our ports, but also others in the region," said Hei Bavy, director general of the Phnom Penh port.
He said that about 90 percent of goods crossing through the docks are construction materials. With many of the country's construction projects stopping or on hold, the port says shipments are in free fall.
"Developers are suspending their imports because they face the credit crunch," he said, adding that staff had been cut from 700 to 400.
"I do plan to cut more staff, but I have reduced salaries to prevent more layoffs," Hei Bavy said.
He added that the company is also instituting across-the-board cost cuts to prevent further job losses.
This affected not only our ports, but also others in the region
Port traffic is falling globally, with Asia bearing the brunt of the international trade slowdown. Singapore, the world's largest container port, said container traffic was down 20 percent, and Shanghai, the world's second biggest, down 19 percent, according to Bloomberg.
drop in throughput at Phnom Penh Port
Cambodia's second largest container port has been affected more heavily than Sihanoukville by the global economic crisis during the first two months of this year
Cambodia's ports are reporting similar troubles, with officials blaming not only a slowdown in the construction sector, but flagging overseas garment sales as well.
The Finance Ministry in February reported a two-percent drop in garment exports at the beginning of the year.
Lou Kim Chhun, director general of Sihanoukville International Autonomous Port, told the Post Wednesday that he is waiting on figures for February, but that container shipments were down 20 percent due to the economic slowdown.
"The crisis has impacted our port revenue, which will hurt the government's tariff and tax income," Lou Kim Chhun earlier told Rasmey Kampuchea.
Hei Bavy said that the export of agricultural goods have been one bright spot for the Phnom Penh Port.
"Agricultural exports have been stable, but I expect the crisis to affect us for a long time," he said, adding that Cambodians should rely more on domestically produced goods.
"If our people stop using imported products, it will support local businesses. The crisis could drain our national wealth if people keep buying foreign goods."