Electrical exports bolster economy in 2023, up 50%
Electrical exports bolster economy in 2023, up 50%
Cambodia exported over $3.1 billion in electrical machinery, equipment and related products to the international market in 2023, an increase of more than 50% compared to 2022. The export value of these products constituted nearly 14% of the country’s total exports, as per data from the General Department of Customs and Excise of (GDCE).
Exports under Harmonised System (HS) Code 85, encompassing the aforementioned products, totalled $3.13 billion in 2023, a 56.6% rise from the $2 billion recorded year-on-year.
These made up 13.8% of the country’s total exports, which amounted to $22.64 billion. In 2022, the same category accounted for 9% of total exports, at $22.25 billion.
For December 2023 alone, exports of Code 85 products amounted to $186.11 million, a 37.6% decrease from the $298.46 million recorded in December 2022.
Lim Heng, vice-resident of the Cambodia Chamber of Commerce (CCC), told The Post on January 25 that the growth in the export of electrical machinery and equipment confirms the advancement of the country’s production chain.
He said it is increasingly meeting international market demands in the context of the current Fourth Industrial Revolution (Industry 4.0).
He highlighted that equipment manufacturers are in global demand, as they can help attract investments from larger businesses to their respective nations.
Heng explained that the country’s ability to produce more Code 85 items makes it easier for major vehicle and machinery manufacturers to establish factories in the country, due to benefits in transportation and taxes.
“As Cambodia has the capacity to produce more of these products, it will help attract firms or factories to manufacture or assemble large machines directly in Cambodia,” he stated.
He added that the export of all products is expected to continue increasing in 2024. Heng attributed this to the growing number of factories in the country producing machines and equipment.
Hong Vanak, director of international Economics at the Royal Academy of Cambodia, noted that having more factories or industries producing machinery and electrical appliances strengthens the Kingdom’s economic foundations.
He said the rise in export value of these products indicates that the country’s production capacity is improving and expanding rapidly.
“This is a positive diversification of Cambodia’s exports, moving away from the past dominance of textiles. With more such goods, more factories will be able to assemble and manufacture machinery in Cambodia,” he added.
According to Vanak, trade agreements and preferential tariffs from major markets are attracting investors to Cambodia.
He said the country’s internal situation is also favourable, considering its environment, politics, security, law, workforce and transport infrastructure, as well as its strategic geographical location.
The Ministry of Economy and Finance’s Budget in Brief for 2024 projects a recovery in Cambodia’s economy in 2024. The expected growth rate is around 6.6%, with the industrial sector anticipated to grow by 8.5%.
“The industrial sector is projected to continue its uptrend at around 8.5% in 2024, up from about 5.0% in 2023. This is due to the expected recovery of the garment sub-sector, while the non-garment manufacturing sub-sector maintains strong growth and the construction sub-sector continues its gradual expansion,” it said.
