WTO discusses Cambodia, China Free Trade Agreement

WTO discusses Cambodia, China Free Trade Agreement

A special meeting held by the World Trade Organisation (WTO) on Wednesday discussed the Free Trade Agreement (FTA) between Cambodia and China.

The meeting also considered the FTA signed between Nicaragua and China along with the India-Australia Economic Cooperation and Trade Agreement. It elected Ambassador José Valencia of Ecuador as the new Chairperson.

The FTA between Cambodia and China covering trade in goods and services, came into force on January 1, 2022. “Under the agreement, China has committed to eliminating customs duties on 97.3 percent of its tariffs by 2041, while Cambodia has committed to eliminating 90 percent of its tariffs during the same period,” a statement issued by the WTO post-meeting said.

“Much of the tariff elimination has been ‘front-loaded’ by both parties, with most tariff reductions already applied since 2022. For trade in services, Cambodia’s sectoral commitments remain the same as in its GATS commitments, except for a limited number of sectors, while China’s existing GATS commitments are further enhanced for a number of sectors under the agreement. The agreement also contains provisions on cooperation under the Belt and Road Initiative (BRI).”

The General Agreement on Trade in Services (GATS) is a WTO treaty that establishes a framework of rules and principles for international trade in services, aiming to create a reliable and predictable system and facilitate the progressive liberalization of services markets.

The Chinese side, speaking at the session, said the agreement is its first bilateral FTA signed with a least-developed country (LDC), noting that this sets a good example of cooperation with LDCs. “China said it is also the first FTA that sets an independent chapter on cooperation under the BRI and that it will enhance value chains between the two countries.”

Meanwhile, the Cambodian representative at the session observed that the agreement is consistent with WTO commitments as it eliminates duties on a substantial amount of trade between the two countries. “Cambodia notes the agreement provides benefits beyond the economic aspect as it also contributes to Cambodia’s broader development strategies.”

The trade between Cambodia and China hit a record high of $15.18 billion last year, a 24-percent increase compared to the previous year (2023). The number constituted nearly 26 percent of the Kingdom’s total trade volume, which stood at $54.74 billion.

The Kingdom’s export value to China was $1.75 billion, an increase of 18.4 percent compared to previous year, while Cambodia’s imports from China stood at $13.43 billion, up 24.6 percent.

Among other things at the WTO meeting, the session saw the Regional Trade Agreement (RTA) committee taking note of one new notification of an RTA, as well as five notifications of changes since its last session in November 2024.

The outgoing chair, Ambassador Salomon Eheth (Cameroon), noted that there are 30 RTAs involving only WTO members and 38 involving non-members for which a factual presentation has to be prepared, counting goods and services separately.

In addition, there are at least 58 RTAs currently in force that have not been notified to the WTO, with an updated list of these circulated prior to the committee meeting and available on the RTA database.

A number of delegations encouraged members to notify these agreements as soon as possible, while noting that delays may be due to constrained capacities of small delegations.

The committee took note of the updated schedule for the submissions of implementation reports on RTAs. It underscored that as of March 1, 2025, such reports were due for 223 RTAs with an additional 15 becoming due in 2025.

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