Kingdom, China ink free trade agreement
Kingdom, China ink free trade agreement
Cambodia and China on Monday signed a bilateral free trade agreement (FTA) following three rounds of negotiations held between January and July.
The two countries hope that goods exchange and investment flows will pick up steam as the new deal guarantees tariff-free access for Cambodian commodities to the Kingdom’s largest export market.
The FTA was signed by Minister of Commerce Pan Sorasak and Chinese ambassador to Cambodia Wang Wentian – on behalf of Chinese Minister of Commerce Zhong Shan.
The ceremony was held at the Peace Palace and was presided over by Prime Minister Hun Sen and Chinese State Councillor and Minister of Foreign Affairs Wang Yi as witnesses.
Sorasak noted that the FTA was the Kingdom’s first such bilateral deal, and that China is a long-standing friend and comprehensive strategic partner of the Kingdom.
“The agreement highlights the strengthening bond between the two countries and represents a milestone in Cambodia-China relations.
“The agreement will enable additional economic partnerships through the higher degree of global market access for goods and investment, and will provide social benefits on both sides,” he said.
Speaking via video link, Chinese commerce minister Zhong lauded the FTA as a “new milestone” in the development of economic and trade relations between the countries.
“China is ready to keep in close communication with Cambodia to push for early entry into force of the agreement,” he said.
Seang Thay, a spokesman for the Cambodian commerce ministry, said the FTA would take effect 30 days after the two countries finalise their internal procedures and legal and regulatory requirements.
For Cambodia, this also implies obtaining approval from the National Assembly and the King, he noted.
Garment Manufacturers Association in Cambodia secretary-general Ken Loo previously told The Post that the FTA with China will strongly stimulate the Kingdom’s exports – not only in the garment sector. There will be a greater flow of investment from China.
“From what we read from the commerce ministry’s statement regarding the results of the third round of negotiations, exports from Cambodia are set to increase more than 20 per cent.
“At the same time, we will see more investment into the raw material supply for garment, footwear and travel goods, electronics and other industries . . . I believe the FTA will help other sectors much more than the garment sector,” said Loo.
Commerce ministry secretary of state Sok Sopheak said in July that the FTA would exempt at least 340 of the Kingdom’s commodities from tariffs.
Sopheak, who is also the head of the FTA negotiation group with China, said exempt items include pepper, dried chilli, cashew nut-products, garlic, honey, vegetables, fish, pork, chicken, duck, beef, goat and seafood products such as mussels, crabs and snails.
The FTA, he added, would eliminate tariffs on 98 per cent of Cambodia’s total exports and 90 per cent of China’s shipments into the Kingdom.
Bilateral trade between Cambodia and China was worth $9.42 billion last year, up 27.29 per cent from $7.4 billion in 2018, data from the Chinese embassy in Phnom Penh showed.
