Tuesday, August 25, 2009

Cambodia and Vietnam Launch Free Trade Zone

BY BUTH REAKSMEY KONGKEA

The Royal Government of Cambodia and the Socialist Republic of Vietnam have launched a Free Trade Zone between the two countries at the Tinh Bien-Phnom Den International Checkpoint economic zone to promote and strengthen the bilateral trade and economic cooperation between both countries. To celebrate the opening there will be a two day festival: the Vietnamese High Quality Products festival, held on the 22nd and the 23rd of August. The launching ceremony of the joint Free Trade Zone was announced on a press conference presided over by Cambodia’s Ministry of Commerce, the People’s Committee of An Giang province of the Socialist Republic of Vietnam and the Embassy of the Socialist Republic of Vietnam to Cambodia in Phnom Penh on August 18. Cambodian as well as Vietnamese traders will be able to sell their goods across the border, free of tax for the upcoming three years.

Mao Thora, Secretary of State for the Cambodia’s Ministry of Commerce, said that the opening of the Tinh Bien Free Trade Zone will pave the way for Vietnamese producers and Cambodian merchants to exchange their products more easily in the future.
“The relation between Cambodia and Vietnam is very close, currently Vietnam is a main trading partner for Cambodia. Thus, I believe that the launching of Tinh Bien Free Trade Zone and the Vietnamese High Quality Products festival will further broaden and strengthen the Cambodia-Vietnam bilateral economic and trade cooperation. It will also build a bridge between Cambodian and Vietnamese traders and producers in future,” he told reporters at the press conference on August 18.
Economists forecast that bilateral trade will reach 2 billion US dollar in 2010 despite a slide of 30 percent in the first five months of this year compared to 2008. Relating to the trade incomes, Thora stated that the total two-way revenue in 2006 was only US$935 million in 2007 this had increased by 27.5 percent to US$1,193 million. In 2008, the total figures of import-export between the two countries have reached approximately US$1,640 million, an increase of 37.4 percent. Of this the total Vietnamese export accounted for US$1,430 millions and Cambodian export made up for US$ 210 million. “The total increase of the trade figures in 2008 by nearly US$500 million compared to 2007 is a result both countries can be proud of. This was obtained by good cooperation and joint efforts under the wise leadership of the heads of government from both countries. The joined goal is to achieve a total trade figure of U S$2 billion by 2010,” Thora further stated.

In its strategy to increase export the Royal Government of Cambodia has planned to focus mainly on 5 products, namely: rice, corn, potato, rubber resin, and cashew nuts. These products are especially suited for the export in the Southeast Asia region. Steps to implement these plans have already been taken. Vietnam has planned to buy a total of 60,000 tons of cashew nuts from Cambodian farmers next year. To promote Cambodia’s exported cashew goods in the future, Vietnam promised to help Cambodia in constructing two finery factories preparing cashew nuts for consumption in Cambodia by 2010. The first finery factory will be constructing in Skun district and another will be located in Memot district, Kampong Cham province. The Cambodian Ministry of Commerce will be organizing a meeting between the cashew merchants of Kampong Cham province and Kampong Thom province at the end of December 2009 in order to regulate sale prices.

Lam Minh Chieu, Chairman of the Vietnamese AN Giang Provincial People’s Committee, said the Tinh Bien Free Trade Zone is an important economic zone for Vietnam. In the province of the Free Trade Zone are two other trading zone, together make up for 70 percent of the total trade between Vietnam and Cambodia. The zone was officially opened by Vietnamese Prime Minister in early 2009 in order to create a bridge between Vietnamese producers and Cambodian merchants. Currently there are a total of 43 traders selling and buying goods at the Tinh Bien border.

The Chairman continued that to promote the import of Vietnamese products to Cambodia, the AN Giang Provincial People’s Committee organized the “Vietnamese high quality goods festival” at the 22nd to the 23rd of August 2009 at Tinh Bien Free Trade Zone in An Giang province in Vietnam. Not only Vietnamese traders will be given the opportunity to show their goods. The AN Giang Provincial People’s Committee will facilitate Cambodian eligible business to display their high quality products at he fair, he said. “I strongly believe that through these trade fairs, they will help to promote solidarity, friendships and bilateral trade cooperation between two countries in future,” he added.

Vu Kim Hanh, President of the Vietnamese High Quality Goods organization, said that to help Cambodian producers in producing and exporting their products, Vietnam will provide a loan for Cambodian eligible business companies to improve their business activities. Kim Hanh said that the loan will be granted through Vietnamese banks operating in Cambodia. She added that Vietnamese load program will begin next year.


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