But analysts warn that the strong trade figures could disguise a drop in the second half of 2008 that followed the Preah Vihear border dispute

Photo by:

Tracey Shelton

Cambodian traders crossing the border checkpoint at the Poipet crossing into Thailand.

EVEN with border tensions over the Preah Vihear temples still simmering, trade between Thailand and Cambodia grew at a brisk 28 percent in 2008, a commerce official said Monday.

"Despite the border problems since July, trade between the two countries has been strong, and reached US$1.8 billion in 2008 from $1.4 billion in 2007," Mao Thora, a secretary of state for the Ministry of Commerce, told the Post.

But most of the trade increase was in the form of Thai exports to Cambodia, with Cambodia exporting only $200 million to Thailand.

He said that Cambodia exported mainly agricultural products such as grain, tobacco, leather, rubber, wood and recyclable trash, while Thailand exported cars, construction materials, petrol, beverages, food products and electronics to Cambodia.

For 2009, Mao Thora predicted that trade volume will match last year's figures, or grow slightly.

"I believe that trade between Cambodia and Thailand will not decline, especially after Prime Minister Hun Sen attends the Asean summit in Hua Hin next month. This will create better trade relations between the two countries."

Chan Sophal, president of the Cambodia Economic Association, said Tuesday that the strong figures could conceal a drop in bilateral trade that followed the border dispute in the second half of 2008.

He said that the conflict and ongoing political instability Thailand may have led many Cambodian companies to use alternative suppliers.

"Thai products are easily substituted with products other countries," Chan Sophal said.   

Turning to Vietnam

The government has not yet released 2008 bilateral trade figures with Vietnam, but the conflict with Thailand and the recent signing of bilateral trade and visa agreements is expected to boost volumes.

A bilateral agreement was signed on November 4 allowing visa-free travel between the two countries, and five trade and investment agreements were inked during an official  visit to Vietnam later that month.

"We expect Cambodia-Vietnam trade volume will be comparable to Cambodia- Thailand trade," Chan Sophal said.

He said that in 2007, bilateral trade with Vietnam totaled $1.2 billion and is expected to exceed $2 billion in 2010 as Cambodia increases its production of rice, cassava and rubber, and institutes stringent new anti-smuggling measures.

Officials also expect the establishment of special economic zones on the border will boost trade and commerce with Vietnam.