Responding to criticism, Cambodia’s apex rice industry body announced yesterday that it would submit a plan to Prime Minister Hun Sen that addresses two of the major challenges facing the Kingdom’s rice sector – competition from rice imports and access to finance for millers.
The Cambodia Rice Federation (CRF), which has come under fire from members critical of the direction in which the nation’s rice industry is being steered, will ask the government to make it mandatory for rice importers to have licences, and ask for its help in facilitating low-interest loans for millers, the federation revealed at a press conference yesterday.
“We have addressed these two main challenges with the government and want them to take action,” CRF president Sok Puthyvuth said. “We will solve these problems urgently because we don’t want to be accused of being all talk and no action.”
Puthyvuth added that a new CRF committee would be formed to find urgent solutions to the rice sector’s woes, and the committee would welcome all members – including those involved in the RISKS initiative, which first raised these issues last week.
The RISKS group, which now calls itself CRISIS (Cambodian Rice Industry Survival Implementation Strategy), submitted a nine-point plan on Monday to the Commerce Ministry with its proposed solutions to tackle issues facing the sector, specifically a 100,000-tonne limit on rice imports from neighbouring countries and access to $250 million in soft loans.
Puthyvuth said that CRISIS’ suggestion to ban or limit rice imports was implausible and requiring all rice importers to have a licence was a more pragmatic solution.“We have tried to solve rice imports from neighbouring countries, but we cannot limit rice imports because we are a free market economy,” he said.
According to the CRF, roughly 1 million tonnes of rice were imported in 2015, accounting for half of the domestic market’s consumption. CRISIS’ report pegged rice imports at 600 million to 700 million tonnes, which it blamed in part for driving dozens of millers into bankruptcy.
Hun Lak, the CRF’s deputy chairman, said that only seven to eight medium-sized millers had gone under, as well as some other smaller family-run mills.
He said the CRF would negotiate a finance package for struggling millers that would provide them access to low-interest loans.
“We will write a specific plan to guarantee that these loans are paid back and millers and exporters will be able to survive the next rice season,” he said.
Om Darasethy, director-general of Battambang-based miller FedRice and a new member of CRISIS, said that millers need a quick solution – something that can have an impact in less than three months – in order to avoid going bankrupt.
“It’s true these are two main challenges, but there are other challenges like our production costs, logistics and electricity costs,” Darasethy said.
He said he welcomed the formation of the new committee under the CRF and would actively participate and contribute in order to alleviate the sector’s problems.
The rice sector was facing both internal and external challenges, said Yang Saing Koma, former president of agriculture organisation CEDAC. He said the government needs to step in and clear hurdles faced by farmers, and the rest of the sector, if it is to survive.
“Farmers are not only dealing with rising production costs, but also with rice imports,” he said. “Rice millers and exporters need to work together with CRF in order to find a solution to this problem.”