RCEP drives major economic boost
RCEP drives major economic boost
Cambodia achieved $8.17 billion in exports to members of the Regional Comprehensive Economic Partnership (RCEP) in 2023, marking a substantial increase of 28.82% compared to 2022. The surge is attributed to the recent improvements in regional and global economic conditions.
The Ministry of Commerce, in a report to The Post dated January 14, detailed that the country exported goods worth $8.17 billion to five leading RCEP members in 2023, namely Vietnam, Thailand, Singapore, China and Japan.
However, bilateral trade among members of the partnership reached just over $29.45 billion in 2023, a decline of more than 5% from the previous year’s $31 billion.
The RCEP, an ASEAN initiative, is currently the world’s largest free trade agreement (FTA), encompassing 15 countries.
These include the ten ASEAN member states plus five significant Indo-Pacific nations: Australia, China, Japan, New Zealand and South Korea.
Penn Sovicheat, spokesperson for the ministry, told The Post on January 14 that the country has greatly benefited from the partnership, particularly in exporting to member states.
He said that this is becoming a new growth area in the region, in contrast to the declining exports to traditional markets in Europe and the US, affected by geopolitical tensions and the aftermath of the Covid-19 pandemic.
“The effectiveness of the RCEP in 2022 has become a new driver for Cambodia’s long-term export growth. Under the agreement, a number of tariff reductions have enabled Cambodia to capitalise on opportunities to boost exports,” he explained.
Sovicheat highlighted China as a significant market for Cambodian exports, particularly for potential agricultural products such as milled rice, yellow bananas, mangos, longans and pepper.
He emphasised the benefits the country gains from the agreement, including preferential tariffs on various goods, technology transfers, skill development and employment opportunities spurred by foreign direct investment (FDI).
Hong Vanak, an economics researcher at the Royal Academy of Cambodia, noted that the rise in the country’s exports to international markets, particularly to RCEP countries amid international economic and political instability, signifies that the nation’s production capacity is increasing in speed and quality.
“Cambodia is now well-prepared to meet increasing international market orders. The country also has the potential to attract direct investment,” he stated.
“Considering Cambodia’s current capabilities, I am optimistic that international trade, especially Cambodia’s exports worldwide, will continue to grow from 2024 onwards. The number of foreign tourists is also expected to rise,” he added.
RCEP nations collectively represent about 2.2 billion people or 30% of the global population.
They contribute to a gross domestic product (GDP) of $26.2 trillion, accounting for 30% of global GDP.
Member countries are responsible for approximately 28% of global trade, as per the ministry’s data.
According to figures from the General Department of Customs and Excise (GDCE), the Kingdom’s total export volume exceeded $22.65 billion in 2023, a 1.8% increase from $22.25 billion in 2022.
