THAILAND and Cambodia are working towards the goal of trade flows between the neighbours reaching US$15 billion in 2020, a jump of almost 10 per cent from the US$6.16 billion booked in 2017, a senior Thai trade official said on the eve of the sixth meeting of the Joint Trade Committee (JTC) today.
Trade between Thailand and Cambodia in 2017 jumped 9.9 per cent from the prior year to US$6.16 billion. The neighbours aim for an annual trade value of US$15 billion in 2020.
Year 2017/ Value (US$:billion)/ % change
Exports from Thailand /5.26/12.8
Imports from Cambodia /0.89/ -4.56
Source: Commerce Ministry
Jirawuth Suwanna-Aat, minister counsellor (commercial) at the Commerce Ministry, yesterday said initiatives were planned for the countries to achieve that target.
Thailand would encourage domestic investors to expand their investments across the border, especially in innovative businesses, information technology, organic food, restaurants and other hospitality ventures. Cambodia needed more of these kinds of investments to develop the country's capabilities, especially in information technology, software and digital services, Jirawuth said.
Aiding this push, the Thai Commerce Ministry set up a business matching event between 30 Thai businesses and more than 100 Cambodian businesses at the Sofitel Phnom Penh hotel in Phnom Penh yesterday. The ministry expects the value of trade from deals hatched at the event to top US$100 million, Jirawuth said.
“This event forms part of our efforts to boost the value of trade between the countries and also open up business opportunities for Thai investors, through local partners, to expand their investments in Cambodia,” Jirawuth said.
Nhay Sochann, chief finance officer of Cambodian trading firm Hong Seng Loan Trading Co Ltd, said she joined in the event as she was looking for Thai products to import into Cambodia, especially food and beverages, given the popularity of Thai products in Cambodia.
“Cambodia people have confidence in Thai products as they believe they are of high quality. This event will help us to find new products to serve the local demand,” Nhay Sochann said.
Today’s sixth meeting of the Joint Trade Committee (JTC) will bring together Thai Commerce Minister Sontirat Sontijirawong with his Cambodian counterpart Pan Sorasak. Among the issues to be discussed are ways to promote growth strategies for the border provinces under economic cooperation between the countries, and a memorandum of understanding (MOU) of cooperation between both sides’ departments of international trade promotion and directorates general of trade promotion.
For 2017, Thailand exports Cambodia goods worth US$5.26 billion, up 12.8 per cent from 2016. Its imports from Cambodia came to US$894.88 million, a drop of 4.56 per cent from 2016. The main Thai exports to Cambodia are oil, gems and jewellery, and beverages. Thailand buys food and other vegetables, gold and gems, and metallic ore from Cambodia.
China tops the list
Thailand ranks in the top nine of countries that have expanded their investments in Cambodia from 1994 to the end of the third quarter of 2017, with an investment value of US$967.89 million, according to the Council for the Development of Cambodia. China led the list with investments of US$10.71 billion for that period. South Korea followed with US$4.88 billion and the UK with US$3.88 billion.
Jirawuth said that Cambodia is opens to business opportunities from foreigners wanting to expand their investment in the country, especially in areas such as hospitals, hotels, agricultural processing, and construction. Prominent Thai investors in Cambodia include CP Group, Betagro Group, Siam Cement Group, PTT Plc, Bangkok Hospital Chain, the TCC Group of beverage tycoon Charoen Sirivadhanabhakdi, Thai Nakorn Pattana Group and Nawarat Pattanakarn.
Doungjai Chanthon, vice chairman of the Thailand-Cambodia Business Council, said that foreign investors can hold a 100 per cent stake in a business in Cambodia, except in matters relating to land ownership. They have to form joint ventures with a local partner and are approved to hold up to 49 per cent of such joint ventures, she said.
Cambodia's government has opened the door to foreign investors in all business categories and there are no limits on the transfer of net profits back home from their operations in Cambodia.
"I have done business in Cambodia for over 10 years, exporting consumer products from Thailand and importing agricultural products from Cambodia,” Doungjai said. “My business in Cambodia has enjoyed strong growth as I also suggest Thai investors should expands their investments in Cambodia, especially in food processing, consumer products, and services such as hospitals and hotels.”
She said that investments in Cambodia offered a broader horizon than merely serving the market of 15 million people in Cambodia, as the country offered more convenient access to the big market of Vietnam with logistics connections between those two countries.