Electrical machinery sales close to double as tech exports surge
Electrical machinery sales close to double as tech exports surge
Cambodia's exports of electrical machinery, equipment and related products surpassed $2.4 billion in the first nine months of 2023, marking an increase of nearly double compared to the same period last year, according to the General Department of Customs and Excise (GDCE).
The exports, classified under Harmonized System (HS) Code 85, reached a value of $2.476 billion between January and September 2023, marking a 93.5% increase from the $1.28 billion recorded in the corresponding interval in 2022.
This accounts for 14.6% of Cambodia’s near $17 billion total export revenue during the period. The same sector represented only 7.5% of 2022’s total exports which amounted to more than $17 billion.
In September alone, the export of these goods saw a 65% year-on-year rise to $314.29 million, from $190.49 million in September 2022.
Hong Vanak, an economist at the Royal Academy of Cambodia’s International Relations Institute, said on November 6 that the country’s progressive development and strategic efforts in drawing both local and international investors have turned the country into a diversified production hub for the global market.
He emphasised that the surge in electrical exports signifies not only an enhancement of the workforce’s capacity but also serves as a magnet for major corporations to establish factories and production facilities in the country.
“The establishment of factories capable of producing machines and components within Cambodia is a considerable draw for large companies, who may prefer to manufacture or assemble products locally to avoid the shipping costs incurred from overseas assembly,” he explained.
He noted that the revenue generated from industries associated with these products could surpass that of the labour-intensive sectors.
He attributed the export growth of these products to a variety of factors including the country’s political stability, strategic geographical location, cost-effective and plentiful skilled labour, efficient transportation network, investment-friendly legislation and access to export markets with preferential tariff agreements.
Chea Chandara, president of the Logistics and Supply Chain Business Association in Cambodia (LOSCBA), said the country’s sound investment policies, competitive energy and labour costs and robust logistical infrastructure continue to draw increasing interest from both domestic and international investors.
He noted that the increasing machin ery exports are set to play a crucial role in compensating for the downturn in textile exports witnessed since mid-2022.
He believes the anticipated improvement in the global political and economic landscape is likely to result in an uptick in the number of companies investing and exporting from the country to international markets.
“The expansion of factories in Cambodia, coupled with advancements in our transportation sector, points to a future increase in the export of [our] products to the international market,” he said.
For reference, the Kingdom’s exports of Code 85 products amounted to $1.998 billion in 2022, an 84.8% increase from $1.081 billion in 2021. These exports, along with related items, constituted 8.9% of the country’s overall export value in 2022, which totalled $22.482 billion, as per the GDCE.
