Cambodia During Economic Integration Issues and Challenges
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1 Cambodia During Economic Integration Issues and Challenges February 2007 Neou Seiha EIC Researcher 1
2 Contents 1. Evolution Cambodian Trade Policy 2. Cambodian Economic Situation during Integration 3. Challenges and Concluding Remarks 2
3 Evolution of Cambodian Trade Policy 3
4 Cambodia s Economic Integration 1980s: Trade regime was firmly controlled by the state; 1989: Started Launching economic reforms (partially) that opened and deregulated economy; 1993: People elected a coalition government who committed to Democracy and Free Market Economy; Some bilateral trade agreements, especially with US (Quota) and EU (EBI) Join the economic cooperation of the GMS A member of ASEAN in April 1999 A member of WTO in October
5 Share of Trade in GDP 160% 120% Fully adopted free market; Openness & reform process Member of WTO 80% 40% Partly free market Member of ASEAN 0%
6 Cambodian Economy during Economic Integration 6
7 Cambodia s Economy - Update p Nominal GDP - Million US$ 3,651 3,970 4,277 4,592 5,264 7,170 GDP per Capita - US$ Real GDP Growth 7.7% 6.2% 8.6% 10.0% 13.4% 10.4% Inflation rate -0.9% 0.0% 1.2% 3.9% 5.6% 4% FDI - Million US$ Source: National Institute of Statistic Compared to other countries in the regions: Good performance in term of economic growth GDP per capita is still low Low inflation rate Low FDI 7
8 Cambodia s Economy - Update Cambodia's Real GDP Growth by Sector (%, 2000 prices) Agriculture Crops Industry Garments Services Tourism Total GDP Sources: National Institute of Statistics Agriculture sector depends largely on weather condition. Engine of Growth: Garment (quota system) and Tourism 8
9 Cambodia External Trade Merchandise Trade in Cambodia, (Million of US$) Total goods export 1,130 1,397 1,571 1,770 2,087 2,589 2,910 Textile and garment 60% 73% 76% 79% 78% 80% 78% Agriculture 27% 17% 16% 13% 15% 13% 14% Re-export 12% 8% 7% 6% 6% 5% 5% Total goods import 1,592 1,936 2,094 2,361 2,668 3,269 3,928 Garment-related material 22% 27% 29% 30% 30% 31% 28% Petroleum 20% 17% 17% 15% 16% 19% 21% Import for re-export 6% 5% 4% 4% 3% 3% 3% Source: Compiled from data provided by National Bank of Cambodia 9
10 Export Product share by Country China 0.7% ASEAN 4.6% Other Countries 21.4% EU 20.5% USA 52.8% Sources: MoC
11 Import Product share by Country Other Countries 34.2% ASEAN 37.9% EU 4.1% China 22.7% USA 1.1% Sources: MoC
12 Trade balance by Country 1,500 1, ,000-1,500 Million US dollar ASEAN China EU USA Trade deficit with ASEAN and China Trade surplus with US and EU Sources: MoC
13 FDI Stock By 2005 Other 57% Garment 25% Agriculture 4% Hotel 14% Sources: MoC Source: Reproduced from NBC 13
14 Challenges and Concluding Remarks 14
15 Major Challenges for Cambodia s Economy Narrowed-Based Economy Garment and Tourism Limitation of Agro-industry Investment Most of the poor derive their income from Agriculture Export Market Constraints Standards and conformity Assessment Subsidy Potential lost of Revenue from international Tax Oil and Gas revenue 15
16 Cambodia Competitiveness Global Competitiveness Index (GCI) in 2006: 125 countries Countries 2006 Ranks Singapore 5 Japan 7 Korea, Rep. 24 Malaysia 26 Thailand 35 Indonesia 50 China 54 Philippines 71 Vietnam 77 Cambodia
17 Thank for your attention!!! 17
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