Cambodia-US trade shows signs of recovery
Cambodia-US trade shows signs of recovery
Despite the challenges posed by weak global economic growth, bilateral trade between Cambodia and the US achieved a value of just over $9 billion in 2023, marking only a slight year-on-year decrease. In an encouraging trend, the latter part of the year witnessed a gradual recovery in trade flow between the two nations.
Data from the General Department of Customs and Excise (GDCE) indicates that in 2023, the bilateral trade amounted to $9.15 billion, a 1.4% decline from $9.28 billion in 2022.
Cambodian exports to the US were valued at $8.9 billion, down 0.8%, while imports from the world’s largest economy stood at $257.18 million, a 17.7% reduction.
This led to an expansion of the Kingdom’s trade surplus with the US to $8.64 billion, up slightly from $8.65 billion in 2022.
The US remained the country’s second-largest international trading partner, comprising 19.55% of Cambodia’s total international trade, which totalled $46.83 billion in 2023.
In December alone, trade between the two countries was valued at $787.69 million, a 2.19% increase over December 2022.
Cambodian exports to the US totalled $753.11 million, a 0.3% increase, while imports from the US stood at $34.58 million, surging by 75.7%.
Hong Vanak, an economics researcher at the Royal Academy of Cambodia, told The Post on January 11 that the transfer of goods between the two countries has been declining since mid-2022.
He attributed the decline to the global economic downturn and conflicts in certain countries impacting global demand.
Vanak noted, however, that the economic situation and global demand have started to gradually increase.
“Although the volume of Cambodia-US trade in 2023 declined, the contraction was only significant in the first half of the year, as trade between the two countries began to increase gradually in the last few months. For 2024, I believe the trade volume will surpass that of 2023,” he stated.
Lim Heng, vice-president of the Cambodia Chamber of Commerce (CCC), agreed that the decline in trade is a result of the global economic crisis, which has led people reducing their daily expenses.
He emphasised that Cambodia, with over 90% of its exports going to the US, needs to enhance its capabilities by diversifying the quality, price and variety of its products.
Currently, most exports to the US market are textile products.
“The decline in trade volume is due to the impact of the global economy, not because of a decline in Cambodia’s production and export capacity,” he explained.
Heng also noted that Cambodia’s exports to the US, including clothing, footwear, handbags and bicycles, are linked to tourism. Thus, a recovery in the global tourism sector could lead to a resurgence in exports.
Prime Minister Hun Manet highlighted the mutual benefits of cooperation between the two countries while addressing the opening ceremony of the US-Cambodia Business Forum in the US’ New York City last September.
He noted that their collaboration is enhanced by Cambodia’s strategic location, along with its abundant, inexpensive and skilled labour force, which is advantageous for the manufacturing sector.
He noted that this synergy has led to lower prices for Cambodian-made goods in the US market, benefiting both nations.
The prime minister added that the scenario presents a favourable opportunity for US investors and businesspeople to explore Cambodia’s potential.
He encouraged investors to delve deeper into understanding the Kingdom, expressing the government’s commitment to fostering cooperation and business expansion.
“I encourage investors to learn more about Cambodia. The government will continue to strongly support opportunities for cooperation and business expansion, as well as address all challenges, both old and new, to enhance the momentum of private sector development in becoming key partners of the government,” he said
In 2022, bilateral trade between Cambodia and the US totalled $9.281 billion, an 18.6% increase from $7.826 billion the previous year, as reported by GDCE.
Cambodian exports accounted for $8.969 billion, up 19.7%, while imports from the US stood at $312.48 million, down 7.1%.
The Kingdom’s trade surplus expanded to $8.656 billion in 2022.
