Global growth predicted to boost demand for steel
Global growth predicted to boost demand for steel
Cambodia spent approximately $333 million on iron and steel imports during the first 11 months of 2023, marking a slight increase compared to the same period of 2022.
The rise in expenditure reflects the gradual progress in the construction sector, which has been affected by the global economic downturn, according to the General Department of Customs and Excise (GDCE).
From January through November, imports of goods falling under Harmonized System (HS) Chapter 72, which includes iron and steel, totalled $333.23 million.
The amount represents a 1.8% increase from $327.41 million in the corresponding interval of 2022, accounting for 1.5% of the country’s total imports in the first 11 months of 2023, which amounted to $22 billion.
In November alone, Chapter 72 imports stood at $27.26 million, up 6.7% from November 2022’s $25.54 million.
Chiv Sivpheng, general manager of the Cambodia Constructors Association (CCA), told The Post that despite the near resolution of global concerns about the Covid-19 pandemic, crises such as geopolitical conflicts and wars continue to exert pressure on global economic growth.
He said the downturn adversely affects the Cambodian economy, particularly its construction sector.
He noted that there have been fewer construction activities over the past three to four years, leading to a reduction in the import of steel and other construction materials.
However, he pointed out that several steel factories are now operational within the country.
“As politics and the world economy improve, construction will increase and then imports of construction materials, including steel, will rise,” he stated.
According to Sivpheng, the majority of steel used in the country’s construction sector is imported from Vietnam, China and Thailand.
Huy Vanna, secretary-general of the Housing Development Association of Cambodia, noted that the global slowdown in real estate and construction markets has significantly impacted the construction sector for over three years, particularly affecting large projects funded by foreign investors.
He said slow construction has reduced the demand for steel in the sector and that the industry needs more time to return to its pre-pandemic levels.
“Imports of steel in the construction sector will rebound as global economic growth strengthens, with many investors now seeking accommodation and business ventures. When construction activity increases, so too will demand for steel,” he said.
On September 20, the Council for the Development of Cambodia (CDC) granted approval to Huale Steel (Cambodia) Co Ltd to invest $40 million in a new foundry in the Sihanoukville Port Special Economic Zone (SPSEZ), expected to create 523 new jobs.
According to the CDC, steel factories are currently operational in Banteay Meanchey and Kampong Speu provinces.
In 2022, the Kingdom’s iron and steel imports totalled $359.82 million, marking a 23.1% increase from $292.34 million in 2021, as per the GDCE.
