The first round of negotiations for a Cambodia-China Free Trade Agreement highlighted the potential for creating strong economic and investment partnerships between the countries in the upcoming years, the Ministry of Commerce said on Tuesday.
During bilateral talks on January 20-23 last year in Beijing, China, Prime Minister Hun Sen and his Chinese counterpart Li Keqiang greenlighted a feasibility study on the potential free trade agreement (FTA), the ministry said.
It said the FTA aims to boost bilateral trade to $10 billion by 2023.
The first round of negotiations was held in Beijing on January 20-21 and was presided by Ministry of Commerce secretary of state Sok Sopheak and Assistant Minister of Commerce of the People’s Republic of China Ren Hongbin.
“Both sides evaluated the close relations between Cambodia and China, and noted the importance of the negotiations for a Cambodia-China Free Trade Agreement to enhance relations and bilateral economic ties.
“Following two days of negotiations, leaders of the countries’ 10 working groups noted mainly positive results from exchanging ideas and stances, and agreed on some of the agreement’s articles,” said the ministry.
Ministry spokesman Long Kemvichet said an FTA can be considered as the next step in strengthening a rule-based trading system with partners.
“This is different from a unilateral arrangement provided through various preferential systems by partners where the decision to give and withdraw is at the discretion of the providers and not based on legal instrument such as FTAs,” he said.
He noted that Cambodia benefits from several FTAs as a member of Asean, including the Asean-Hong Kong FTA and Asean-Australia-New Zealand FTA.
Garment Manufacturers Association in Cambodia deputy secretary-general Kaing Monika said the moves towards an FTA come at a crucial time for the Kingdom.
“I think it’s the right direction and the right time for Cambodia to start looking at negotiating FTAs with various countries and blocs.
“Cambodia is expected to graduate from the UN’s Least Developed Countries status in the next five to six years, after which we will lose the trade preferences provided to us by many developed countries.
“Cambodia’s trade in the future should be supported and promoted by FTAs,” said Monika.
He noted that the Kingdom participates in a very limited number of FTAs, which are all under Asean as a bloc.
“We need to target more bilateral FTAs, and China is indeed our greatest potential partner. This is a market of more than one billion people and the world’s number one economy in terms of purchasing power parity.
“Since we are good allies and China is willing to help Cambodia, I believe the conclusion of the negotiations should be a record for the shortest time taken compared to the negotiations of other FTAs,” he said.
The ministry’s press release said the next step is for both sides to deliberate on the issues raised and points suggested by the working groups and promptly reach a compromise for an FTA.
“The second round [of negotiations] is expected to be held in Cambodia in the first half of 2020,” it said.
Bilateral trade volume between the two countries reached $7.4 billion last year, a 22 per cent increase compared to 2017’s $6.04 billion, ministry data shows.