Neighbouring Vietnam has consolidated its position as the second biggest trade partner of Cambodia after China with trade volume between the two rising by 24.5 percent to reach $2.32 billion in the first three months of this year (Q1, 2024), compared to the same period last year, according to data released by the General Department of Customs and Excise (GDCE), recently.
Vietnam is also Cambodia’s second biggest export market after the US with $1.39 billion in Q1, an impressive growth of 53 percent year-on-year. Cambodia mostly exports agriculture products such as cashew nuts, cassava, coconuts and rubber to Vietnam.
Cambodia imports mostly refined petroleum products and raw iron bars from Vietnam.
While the US has a share of 31.7 percent of Cambodia’s exports at $2.04 billion in Q1, Vietnam claims a share of 22.2 percent. China, which is in the third position, accounted for $366 million worth of exports from Cambodia, a rise of 11.4 percent, but it accounts for only 5.8 percent of the export market of the Kingdom.
Cambodia also imports heavily from Vietnam, in fact, the second most with Q1 data showing $934 million worth of goods bought from the neighbouring country. Cambodia’s imports from China constitute the biggest chunk at $2.84 billion in Q1, 2024.
Thus, Cambodia has a $2.47 billion trade deficit with China but it enjoys a surplus of $458 million in trade with Vietnam.
Speaking with Khmer Times, yesterday, Ky Sereyvath, Senior Economist and Director General of the Institute of China Studies said that Vietnam imports raw materials from Cambodia and exports finished products to other countries.
“When Cambodian agricultural products go through Cat Lai Port in Vietnam, they need to follow Sanitary and Phytosanitary Measures (SPS) imposed by the Vietnam government which restricts the exports of Cambodia to third countries. This results in Cambodia’s agricultural products mostly ending up exported as raw products to Vietnam,” Sereyvath explained.
He also indicated that this could be one of the reasons for Vietnam to oppose the Funan Techo Canal which could help Cambodia access a wider market for exporting its agri products which can affect the supply chains in Vietnam.
For example, Cambodia produces upwards of 1.1 million tonnes of cashew nuts annually on a total land area of nearly 700,000 hectares. However, only five to 10 percent of its annual total product is locally processed, leaving more than 90 percent of its raw cashew nuts exported, mainly to neighbouring Vietnam.
In 2023, Cambodia exported $837 million worth of raw cashew nuts, according to the Cashew Nut Association of Cambodia’s report. It exported 656,000 tonnes of the commodity and of this, some 618,000 tonnes, or 94.2 percent, were shipped to neighbouring Vietnam, the report pointed out. (Khmertimeskh)
