Logo of Phnom Penh Post newspaper Phnom Penh Post - Free trade area touted

Free trade area touted

Free trade area touted

The Asean summit November 5-6 in Brunei, announced advances in forming an Asean free

trade area (AFTA) between the struggling regional body and China. It would be the

world's largest free trade area with a market of 1.7 billion people, but could take

ten years to implement.

Although some member countries were concerned about the impact of cheap Chinese imports

on their domestic markets, government spokesman Chem Widhya said that was unlikely

to hurt Cambodia. China's imminent accession to the World Trade Organization (WTO)

would also bring great benefits.

"Cambodia has not yet developed a modern heavy industry, so we are not concerned

[about any impact on that]. Also, China will provide a preferential tariff treatment

to Cambodia for the importation of our goods," said Widhya, "because Cambodia

is still poor [compared with] other Asean countries."

Minister of Commerce Cham Prasidh told the Post November 7 he welcomed China's accession

to the WTO as Cambodia would gain access to China's huge domestic market under a

bilateral agreement under discussion between the two countries.

"We will have a greater ability to export our goods to China, which is the biggest

market in the world," said Prasidh. He expected Cambodia would export mainly

agricultural products such as rice, soya beans, corn, and coconut oil.

"China will give us a preferential tariff, which will give us a better advantage

than other Asean countries," said Prasidh, although he cautioned that details

on the tariff deal needed to be discussed. Prasidh said he was not worried that cheap

Chinese goods would harm the domestic market.

Urooj Malik, resident representative of the Asian Development Bank, agreed the deal

would bring strong opportunities. Among these, he said, were that China might well

manufacture goods in Cambodia and export them back to its own market, which would

help with job creation.

"Cambodia is now part of AFTA, and in the future the country will be part of

the WTO," said Malik. "I think Cambodia is moving in the right direction."

Malik cautioned that cleaning up corruption would prove important: it was widespread

and the government needed to institute policies to combat that if it was to garner

the full benefits.

Sok Hach, senior economic advisor at the Cambodian Development Resource Institute,

stressed the importance of reform. Rampant corruption was a major factor in dissuading

investors to put their money here, and reduced the country's competitiveness.

"In theory AFTA means that we move out of the gate at our house so that others

can come to our house and we can go to other people's houses. The reality is that

we cannot go to other people's houses because we are not competitive," said

Sok Hach.

MOST VIEWED

  • Massive stingrays may live in Mekong’s deep pools

    US scientists have suggested that unexplored deep pools in the Mekong River in an area of Stung Treng could potentially be home to significant populations of giant freshwater stingrays, one of the world’s largest freshwater fish species. This comes as a fisherman hooked a 180

  • CCC team off on US business trip

    The Kingdom’s leading economists and private sector representatives have called on the US to renew its tax preferential status for Cambodian exports, as a Cambodia Chamber of Commerce (CCC) delegation departed for a weeklong business visit to the US, where they will meet with

  • PM takes time to meet, greet Cambodians living in the US

    After landing in the US ahead of the ASEAN-US Special Summit, Prime Minister Hun Sen was received by over 1,000 Cambodian-Americans including political analysts who welcomed him with greetings, fist bumps and selfies. Hun Sen also met with analyst Mak Hoeun, who had allegedly spoken ill

  • Khmer cinema classics back on big screen for free at WB Arena’s outdoor movies series

    On a recent Saturday evening at WB Arena, Bunsong was enjoying a tasty BBQ meal with his family after work on the long tables that had been arranged out in front of the restaurant as they watched a Khmer action movie on a big outdoor

  • PM heads to Washington for ASEAN-US special summit

    Regional and international issues and how to bring the ASEAN-US partnership to another level will be discussed at length as Prime Minister Hun Sen and his ministers arrive in Washington, DC, for a special summit on May 12-13. During the trip, Hun Sen and ASEAN

  • National Assembly refutes EU resolution

    The National Assembly (NA) has hit back at a European Parliament resolution condemning the political and human rights situation in Cambodia, calling it another display of the Parliament’s “double standards”. Key points of the resolution include a warning that the Parliament could exclude the