Abu Dhabi: The UAE’s non-oil exports to Cambodia have risen by 639 percent from 2010 to 2011, with total Emirati exports to the Asian country going up by 271 percent during which the UAE achieved a surplus in trade between the two countries of around USD 2.3 million in 2011, in comparison with a deficit the year before worth around 8.5 million, with total bilateral foreign trade between the two countries growing by 122 percent in 2011.
This data was made available in a study released today by the Ministry of Foreign Trade on trade relations between the UAE and Cambodia within the framework of a visit currently being conducted by Sheikha Lubna bint Khalid Al Qasimi, Minister of Foreign Trade, to Cambodia, where she is heading a UAE delegation to strengthen trade and investment relations with the Asian country.
The study also revealed that Cambodia went up to the 99th position in the list of countries on the receiving end of UAE re-exports, after it was at the 143rd position in 2010.
Although the growth indicators are positive and rapid, the study emphasized the importance of supporting trade exchange between the two countries in order to increase the value and size of traded material and commodities considering their limited nature at present.
The study revealed that in numbers, the growth in foreign trade between the two countries from 2010 – 2011 was from USD 22.5 million to USD 48.8 million, respectively. However, this excludes the UAE’s free zone trade with Cambodia, which reached USD 39 million in 2011, exceeding the level of foreign trade between both countries, with both combined reaching USD 89 million in 2011.
Moreover, parallel to the increase of 55 percent in non-oil UAE exports to Cambodia in 2011, the largest growth was witnessed in the re-export sector, which went up from USD 2.6 million in 2010 to USD 19.2 million in 2011 – achieving a growth rate of 639 percent. This increase in re-exports has bulged the UAE’s total exports to Cambodia by 271.4 percent from USD 7 million in 2010 to USD 26 million in 2011. Moreover, UAE imports from Cambodia were valued at USD 15.5 million in 2010 and went up to USD 23.7 million in 2011.
Export Opportunities 2011 saw the creation of numerous opportunities to export UAE products to Cambodia. Exports were primarily plastics and their products as well as dying extracts. 2011 also saw the creation of new re-export opportunities to Cambodia in the following commodities: machinery and mechanical appliances, wood and wood products, food products, cast iron products, and clothes.
Investment Legislations As far as investment legislations are concerned, the study revealed that the Cambodian investment law is exceptionally clear and offers many benefits and incentives to foreign investors. It also provides a low-cost investment environment that encourages expansion.
The law offers a number of incentives for attracting investment projects into Cambodia. These include: 9 percent income tax on companies; tax alleviation on companies for periods up to eight years (depending on the type of company and government priorities); Zero customs on imports for construction purposes in projects centered on exporting at least 80 percent of their products; zero customs on projects inside special zones.
The study also highlighted a number of sectors and trends witnessing growth in Cambodia. These include: Technology intensive industries, export oriented industries, tourism, agricultural industries, manufacturing, infrastructure development, energy, developing provinces and rural areas. In the mean time, total FDI in Cambodia in September 2011 was at around USD 4.3 billion, marking a huge increase from the same time in 2010 when it was USD 2.2 billion. The Cambodian economy also saw an increase in value to around USD 12.9 billion in 2011 and USD 14.2 billion in 2012, with a 10.1 percent increase due to the development of the country’s tourism sector and an increase in exports.
Agriculture is considered Cambodia’s primary economic sector with a 32 percent contribution to the country’s GDP. The country’s main agricultural products are: rice, rubber, corn, and cassava. Industry is the country’s second most important sector, with a 22 percent share of the GDP, followed by tourism (with over 3 million tourists visiting annually).
The mining sector also plays an important role in attracting the attention of investors, especially in the northern parts of the country, where there are bauxite, gold, iron and precious stones mining opportunities. Cambodian exports of natural pearls and precious stones increased by around USD 70 million in 2011 in comparison with 2010 when it was a much lower USD 4 million (achieving an increase of 1650 percent).
Moreover, oil wells have been recently discovered in Cambodia, which are expected to cause a big change in the Cambodian economy.