Kingdom, China ink contract for rice storage facilities, drying silos
US official: Japan trade deal progress likely in ‘the weeks and months ahead’
CAMBODIA signed an engineering, procurement and construction contract on the “Promotion of Paddy Production and Rice Exports Project” with Chinese state-owned company CITIC Construction Co Ltd to build rice storage facilities and drying silos in strategic locations in the Kingdom, the Ministry of Economy and Finance said.
The signing ceremony was held on Thursday and inked by Cambodian Minister of Commerce Pan Sorasak with CITIC Construction chairman Chen Xiaojia.
The project aims to help rice farmers, traders and exporters and is in line with supporting the government’s strategy to export at least one million tonnes of milled rice to international markets a year. The project will also prevent declines in paddy prices.
The agreement states that CITIC Construction and the Kingdom’s Green Trade Company will build paddy and milled rice warehouses in 12 locations, with a total capacity of 827,000 tonnes, and drying silos at 10 locations, which will be capable of drying 13,000 tonnes per day.
The facilities will be located in Pursat, Battambang, Takeo, Banteay Meanchey, Siem Reap, Kampong Thom, Kampong Cham, Prey Veng, Kandal, Kampong Speu and Preah Sihanouk provinces.
“Through the project, Cambodia will have sufficient capacity to increase rice exports to international markets,” said the press release.
Mekong Oryza Trading Co Ltd chairman Hun Lak welcomed the news, saying that Cambodia lacked the required facilities during recent harvest seasons, despite
the state and private sectors’ efforts.
However, he said there is no guarantee that the new facilities can resolve the sector’s issues, and that more investor capital is needed.
‘More opportunities’
Baitang (Kampuchea) Plc president and chairman Phou Puy said paddy and rice facilities have been planned almost everywhere, especially in the four major rice producing areas – Battambang, Kampong Thom, Prey Veng and Takeo provinces.
He said the additional facilities will open up more opportunities for farmers.
“We welcome the investment because farmers will have more opportunities in terms of competitive prices,” he said.
Along with the signing above, Swissbased Buhler Asia Private Limited on Wednesday unveiled plans to invest in high-tech drying silos in Cambodia.
At a meeting with Sorasak, Buhler Asia chairman David Wang said he plans to invest in building modern dried silos in 10 locations in 10 target provinces.
During the first four months of this year, Cambodia exported more than 210,000 tonnes of milled rice to international markets – up more than eight per cent compared to the same period last year.
Cambodia’s rice exports last year amounted to 626,225 tonnes – down some 1.5 per cent from 2017. The EU market has the largest volume of 269,127 tonnes and China with 170,154 tonnes. TOKYO understands Washington’s desire to negotiate greater access to the Japanese market and efforts to reach a new trade agreement should bear fruit soon, a top US trade official said on Wednesday.
The testimony by US Trade Representative Robert Lighthizer comes a week before US officials are due to meet Japanese counterparts on the sidelines of the Group of 20 (G20) summit in Osaka, Japan, according to Lighthizer.
He told a House of Representatives panel on taxes and trade duties that US farmers are now at a disadvantage in exporting to Japan, which has entered a new trade agreement with Europe and is also party to the Transpacific Partnership (TPP) – giving Australian and Canadian exporters an advantage over the US.
President Donald Trump withdrew from the TPP on his first full day in office in 2017, claiming it would have led to job losses and further erosion of US manufacturing.
“We understand the nature of this problem and we have to resolve it because if we don’t, these farmers are going to lose that market, because of nothing they did, just because Japan gave more access to somebody else, and they may never get those markets back,” Lighthizer said in a second consecutive day of congressional testimony.
“And the Japanese understand completely our position and I’m hopeful that we’ll have something resolved in the weeks and months ahead, but there’s an enormous amount of urgency.”
During a meeting in Tokyo last month with Japanese Prime Minister Shinzo Abe, Trump complained of the sizeable US trade deficit with Japan, which amounted to $67.2 billion in goods last year.
Trump expects to meet his Chinese counterpart Xi Jinping at the G20 summit this week in an effort to rescue trade negotiations that appeared to collapse last month.
US officials accused their Chinese counterparts of backsliding on commitments made in the talks. Lighthizer said he was hopeful the talks could resume productively.
“My speculation is that some forces in China decided that they had gone too far, went out beyond their mandate,” he said.