
MONTHLY CAMBODIA UPDATE
Cambodia Update | April 2, 2019 Author: Jack Myint |
LOOKING AHEAD |
April 9: Welcome Roundtable in Honor of H.E. Chum Sounry, Ambassador of Cambodia to the United States.
Please contact Jack Myint at jmyint@usasean.org with any questions. |
THE COUNCIL’S TAKE |
Cambodia Announces Major Economic Reforms to Relieve Pressure from EU’s Potential Withdrawal of Everything but Arms Trade Benefits
On March 29, Cambodia’s Government-Private Sector Forum, an annual event where private sector representatives get to address their concerns directly to the prime minister, was held in Phnom Penh. During the forum Prime Minister Hun Sen announced that his government plans to launch large-scale economic reforms to help stimulate economic growth and offset the loss of a preferential trade agreement – the Everything but Arms agreement – that the European Union (EU) has threatened to withdraw in light of alleged “systemic” electoral and human rights violations. Read the Council’s latest analysis on the EU’s move to remove Cambodia’s trade privileges here. Prime Minister Hun Sen detailed a 17-point strategy, which he says could save the private sector up to US$400 million annually. The strategy includes reduction of shipping costs, electricity rates, and port service fees for businesses. Hun Sen also announced plans to reform railway operations management, introduce fiscal incentives on tax and customs for small and medium-sized enterprises and the agriculture sector, expedite the completion of the Law on Investment and the Law on Special Economic Zones by the first half of 2019, and to reduce the number of national holidays from 30 to 23 days. These initiatives, if properly implemented, could help increase national productivity, lower business’ production costs, and make Cambodia a more attractive destination forforeign direct investment. As of January 29, the Royal Government of Cambodia has ended the role of the Cambodia Import-Export Inspection and Fraud Repression Directorate General (CamControl) at the country’s border crossings. According to Prime Minister Hun Sen, this will reduce logistical costs for the private sector by eliminating service fees at terminals and state ports. Also, effective April 1, theGovernment will reduce by half the scanning fee for exported and imported containers. Specifically, the fee will be dropped from US$32 to US$16 for 40-foot containers, and from US$20 to US$10 for 20-foot containers. Additionally, electricity rates will be reduced by $0.02 per kilowatt-hour for industrial users, and plans are currently underway to further reduce prices for skill-based and high-capital industries. Inaugural Digital Cambodia 2019 Conference Concludes with Positive Growth Outlook
During the conference, Deputy Prime Minister and Minister of Economy and Finance Aun Pornmoniroth said that the Cambodian economy is moving away from a basic agrarian model to one that is more technology-driven and centered on services and industry. The country’s digital economy has in fact been progressing steadily every year, with new businesses emerging in digital payment, online entertainment, and e-commerce. DPM Aun Pornmoniroth added that the Government continues to prioritize the development of the digital economy by revising and formulating policies to promote the use of new and emerging technologies in business and developing human capacity and skills to best utilize these new technologies. The Government will also attempt to mitigate possible risks arising from these developments through appropriate legal and regulatory frameworks. However, DPM Aun Pornmoniroth said Cambodia’s digital economy remains in its nascent stage and would need at least a decade to lay the groundwork for digital readiness. During this time, the government pledges to develop and implement a long-term digital economy strategic framework, which will provide a path for both local SMEs and large conglomerates to connect to regional and global digital economy value chains.
While Cambodia is a developing country, its growth prospects and its ability to leapfrog are encouraging. Cambodia possesses a fast-growing youth population that is educated and technology savvy, meaning that it has contributed to the high mobile and internet penetration rate (100% and 84% respectively, according to Ministry of Economy and Finance statistics), fast technological spillover from FDI inflows, and comparatively rapid digitization in all key economic sectors. Nevertheless, Cambodia’s development still faces challenges. According to the World Bank, rising costs of living have made it difficult to continue to export low-value goods, and receiving less generous donor packages, particularly from the United States and the European Union amidst ongoing political tensions, can be an obstacle to continued development. |
IN THIS UPDATE |
ARTICLE CLIPS |
Multilateral Trade AgreementsCambodia looks to free trade deal with EAEU The Cambodia Daily 25th Mar 2019 Cambodia is negotiating a free trade agreement (FTA) with the Eurasian Economic Union (EAEU), a common market comprised of five nations of the former Soviet Union, hoping the new market will maintain the Kingdom’s economic growth. The EAEU – comprised of Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia, with 183 million people and a combined GDP of $2.2 trillion (Bt70 trillion) – would be a new market for Cambodian firms. Regional AffairsLinking BRI with Cambodia’s rectangular development Khmer Times 26th Mar 2019 CLV negotiations make headway Khmer Times 11th Mar 2019 National AffairsEducation is Government’s Topmost Priority: Cambodian PM Hun Sen The Cambodia Daily29th Mar 2019 Exiled Cambodian Opposition Leaders Are Indicted as Prime Minister Tightens Grip The New York Times 19th Mar 2019 The Mirage of a Cambodia Palace Coup The Diplomat 14th Mar 2019 Cambodia’s foreign policy: Sovereignty, self-reliance and diversification Khmer Times 12th Mar 2019 Citizens urged to not worry about Chinese investment Khmer Times 11th Mar 2019 Why the EU should try to understand Cambodia Khmer Times 8th Mar 2019 Defense & SecurityWhat’s in the New Philippines-Cambodia Defense Meeting? The Diplomat 1st Apr 2019 PH, Cambodia boost defense ties The Cambodia Daily 27th Mar 2019 Cambodia strengthens military ties with the US The Cambodia Daily 22nd Mar 2019 China and Cambodia Hold Their Biggest Military Exercise Yet The Diplomat 21st Mar 2019 EconomicsCambodia announces 17-point strategy to promote economic growth Vietnamplus.vn 1st Apr 2019 PM announces major reforms, Business, Phnom Penh Post Phnom Penh Post 1st Apr 2019 Cambodia takes measures to promote local products vietnamplus.vn 1st Apr 2019 Cambodia PM Hun Sen Says Port Fees Play Key Role In Attracting Global InvestmentsBusiness Times 1st Apr 2019 Public companies to have access to low-interest loans Khmer Times 31st Mar 2019 Cambodia’s PM Hun Sen Unveils ‘Strategy’ to Offset Loss of EU Trade Scheme Radio Free Asia 29th Mar 2019 Prime Minister to meet with private sector today Khmer Times 28th Mar 2019 Cambodia has repaid 8 percent of its debt: report Khmer Times 27th Mar 2019 Cambodia: Between ‘democracy’ and ‘development’ Khmer Times 27th Mar 2019 Cambodia will gain economic sovereignty and national pride, says Phillip Bank Phnom Penh Post 25th Mar 2019 Commerce Minister pitches for more US investments Khmer Times 25th Mar 2019 Cambodia Faces Major Economic Blow as E.U. Weighs Ending Trade Deal The New York Times 24th Mar 2019 Cambodian Ministry of Economy Proposes One-Stop Platform For Centralized Business Services Business Times 20th Mar 2019 Economic reforms on the horizon: Hun Sen Khmer Times 20th Mar 2019 EnergyStrong Demand for Gas to Power Generation in Cambodia – OilVoice Oil Voice 1st Apr 2019 Cambodia to buy 200 megawatts from Laos Khmer Times 24th Mar 2019 Angkor Gold CEO: Cambodia’s Oil and Gas Industry is Ready to Boom Investing News Network 24th Mar 2019 Financial ServicesReacquainting with Riel Khmer Times 28th Mar 2019 NBC: Using the Riel will help to boost the Kingdom’s economy, Business, Phnom Penh PostKhmer Times 27th Mar 2019 Riel message from NBC governor , Supplements, Special Reports, Phnom Penh Post Phnom Penh Post 25th Mar 2019 Food & AgricultureCambodia’s black pepper looks to international market | #AsiaNewsNetwork Eleven Media 1st Apr 2019 Cambodia pledges support to WFP’s 5-year country strategic plan The Cambodia Daily 30th Mar 2019 Cambodia Requests More Loans from the Bank of China to Further Develop Agricultural Sector Agence Kampuchea Presse 19th Mar 2019 PM Reminds One Million-Ton Rice Export Target Agence Kampuchea Presse 14th Mar 2019 Drought warning leads Cambodian government to tell rice farmers not to plant AsiaNews 12th Mar 2019 Kingdom sees minimal change in rice exports between 2016-2018 Phnom Penh Post 7th Mar 2019 Health & Life SciencesThe woman aiming to transform healthcare sector in Cambodia The Cambodia Daily 28th Mar 2019 ICTGovernment bracing for digital economy , Business, Phnom Penh Post Phnom Penh Post 1st Apr 2019 US, China Face Off Over 5G in Cambodia VOA 30th Mar 2019 Cambodia / Ready for a (digital) revolution? Global Times 28th Mar 2019 Cambodia squeezes online speech despite threat of EU backlash Nikkei Asian Review 18th Mar 2019 Full-fledged digital economy not likely in the next decade: Minister Khmer Times 12th Mar 2019 Smart’s fund invests in local tech startups Khmer Times 12th Mar 2019 Cambodia Telecommunications Market 2019-2025 Industry Today 7th Mar 2019 InfrastructureProperty Investing: The appeal of Cambodia The Cambodia Daily 1st Apr 2019 Cambodia’s property sector rises above politics Property Report 1st Apr 2019 Experts: S Reap ‘next Sihanoukville’ Khmer Times 26th Mar 2019 Work begins on Cambodia’s first motorway, thanks to $2bn of Chinese funding GCR 25th Mar 2019 Government says ‘yes’ to Japan’s smart city initiative Khmer Times 25th Mar 2019 Riverside plots await development Khmer Times 8th Mar 2019 Property developer Creed plots own course in Cambodia Nikkei Asian Review 18th Mar 2019 Travel & TourismCambodia to label major attractions ‘Supreme Tourism Sites’ Eleven Media 11th Mar 2019 |