Cambodia imported $1.83 billion worth of major building materials in 2022 – marking a three per cent rise over the $1.77 billion logged in 2021 – accounting for 6.1 per cent of the $29.942 billion in total imports for the year, according to the Ministry of Commerce.
Ministry statistics issued in conjunction with its annual meeting late last month showed that “iron and steel” imports swelled by 22 per cent to $477 million in 2022 from $391 million a year earlier.
On the other hand, the Kingdom bought “cement” and “other construction materials” from abroad to the tune of $25 million and $1.326 billion, respectively, representing year-on-year drops of 43 per cent and less than one per cent, from $44 million and $1.334 billion.
For comparison, Customs figures put last year’s “iron and steel” imports – or those corresponding to Chapter 72 of the Harmonised System (HS) – at $359.819 million, or up by 23.08 per cent year-on-year from $292.339 million. These items do not include “articles of iron or steel”, which instead fall under Chapter 73 of the HS.
Housing Development Association of Cambodia secretary-general Huy Vanna told The Post that the local construction sector was marred by stagnation last year, commenting that progress was hampered by negative spillovers arising from global economic crises unleashed by Covid-19, geopolitical disputes among major powers, and fighting in Ukraine.
He shared three key observations of sectoral trends in 2022: construction was moving along at the vast majority of sites; virtually no new major developments broke ground, especially larger ones with overseas investors; and projects completed that year were exclusively older ventures.
Even if economic growth in Cambodia and elsewhere gains pace this year, growth in the construction sector tends to take longer to return to normalcy than in other areas and may remain at similar levels to 2022, he remarked.
“As I see it, the Cambodian construction sector will continue to face many challenges stemming from global economic crises this year. As a rule, when the sector is stagnant, purchases of construction materials from abroad do not increase,” he said, citing Ministry of Economy and Finance permanent secretary of state Vongsey Vissoth.
Even so, without a substantial uplift in demand, local production capacity of cement, iron and steel will ultimately remain relatively limited, Vanna argued.
Cambodia Constructors Association general manager Chiv Sivpheng confirmed that applications for construction projects and corresponding approvals from the Ministry of Land Management Urban Planning and Construction have experienced declines since late 2019. He blamed global economic slowdown and pandemic-induced travel barriers.
“The Cambodian construction sector will need more time to recover. Projects invested in by locals are powering along faster than they had in the past, when most had been backed by foreign investors,” he said.
He listed major source markets for Cambodia’s building-material imports as China, Vietnam, Thailand, Malaysia, South Korea, Italy and France.
According to the finance ministry’s “Cambodia’s Macroeconomic Situation at a Glance 2022-2023” report, the construction, real estate, and non-garment manufacturing sectors are expected to grow by 1.1 per cent, 1.2 per cent and 11.7 per cent, respectively.
And the construction ministry reported that, between January and November 2022, the government approved 3,827 construction projects nationwide with total registered capital of $2.63499 billion – down by 98 developments and 49.43 per cent in terms of value, compared to the 3,925 and $5.21036 billion recorded over the same time in 2021.