March 1, 2024
PHNOM PENH – Cambodia garnered over $120 million from exports to China in January, a surge exceeding 50% compared to January 2023, as reported by the General Department of Customs and Excise (GDCE).
According to the GDCE, China is the Kingdom’s largest import-export partner, with trade between the two nations totalling $1.15 billion in January, marking an 18.7% increase from $972.74 million in January of the previous year.
Cambodia’s exports to China reached $121.73 million, a 50.1% rise, while imports were valued at $1.03 billion, up by 18.7%.
The Kingdom experienced a trade deficit of $911.16 million for the month, a rise from $810.52 million in the same period of 2023.
Lim Heng, vice-president of the Cambodia Chamber of Commerce, told The Post on February 28 that the country maintains strong diplomatic relations and relies on China as a major supplier for its factories and enterprises.
He said this has resulted in a consistent rise in trade between the two countries, despite the recent severe economic crises.
He attributed the increase in exports to the Cambodia-China Free Trade Agreement (CCFTA) and the Regional Comprehensive Economic Partnership (RCEP), which offer extensive tariff preferences for Cambodian goods, particularly agricultural products.
“The trend of trade between the two countries is set to escalate further in the future, especially in the export of Cambodia’s agricultural goods,” Heng stated.
Regarding the deficit, Heng expressed no concern over the trade gap, as most Chinese imports to Cambodia consist of raw materials or semi-finished goods which are then processed or assembled into finished products for export to international markets.
He noted that in the textile sector, Cambodia imports materials such as fabrics, yarns and needles from China.
Most of the country’s exports to China comprise agricultural products and textiles, while imports from the world’s second-largest economy are varied, including raw materials for the textile sector, construction materials, automobiles, machinery, electronics, medicine, food, pharmaceuticals and chemicals, as per the GDCE.
At a bilateral meeting in October 2023, Chea Vuthy, secretary-general of the Council for the Development of Cambodia (CDC), informed delegates from the Chinese Chamber of Commerce, led by chairman Lin Shiqiang, about the Kingdom’s new investment law.
He highlighted two primary areas of interest for Chinese financiers: high-tech sectors and agriculture and processing for domestic and export markets.
“Under the new investment law, there are 19 priority areas. The two we are particularly focusing on are investment in high-tech, innovative and research and development sectors; and secondly, investment in agriculture, agro-industry and processing … that caters to the domestic market or export,” he said.
Vuthy noted that to assist Chinese investors, the council recently established a China Desk dedicated to offering advice to Chinese investors.
According to the National Bank of Cambodia (NBC), as of the first quarter of 2023, China was the leader in foreign direct investments (FDIs) to the Kingdom, accounting for about 45% of the total 185.7 trillion riel ($45.54 billion). This was followed by investment from South Korea, Singapore, Japan, Vietnam, Malaysia and Thailand.
Cambodia-China trade reached $12.26 billion in 2023, a 5% increase compared to 2022. Cambodian exports contributed $1.48 billion, marking a 19.2% rise. Imports from china totalled $10.79 billion, showing a 3.3% increase, as per the GDCE.