EU, Germany to provide $9M Asean fund
THE EU and Germany have committed to help strengthen Cambodia’s economic integration with Asean member states by providing a € 9.35 million ($10.5 million) fund to boost the Kingdom’s trade and investment in the region.
The pledge falls under the Asean Regional Integration Support – Cambodia Trade-Related Assistance (Arise Plus Cambodia) programme and was made during a workshop in Phnom Penh on Friday.
According to a press release, the project is co-financed by the EU and Germany’s Federal Ministry for Economic Cooperation and Development (BMZ) and is to be implemented from 2019 to 2023 by the Deutsche Gesellschaft fur Internationale Zusammenarbeit (GIZ), which translates in English to the German Corporation for International Cooperation.
Arise Plus Cambodia aims to strengthen economic networking and integration between Cambodia and the other Asean states.
The project supports the implementation of agreements under the World Trade Organisation Trade Facilitation Agreement and trade with Cambodia is to be made easier by modernising customs clearance.
In addition, the project helps to improve the skills and expertise of responsible organisations, with the aim of assisting the country in better coordinating, formulating and implementing trade-relevant strategies, negotiations and reforms.
The government will receive support in improving its regulatory practice, leading to a more transparent, predictable and competitive trade environment.
The project will also support small and medium-sized enterprises (SMEs) in identifying and realising trade potential in the Asean Economic Community (AEC), with better access made available to trade-relevant information and public-private dialogue forums.
Outgoing EU ambassador to Cambodia George Edgar said during Friday’s workshop that the EU’s trade-related assistance has contributed in the past to simplifying export and import procedures in Cambodia as well as customs automation.
“The national component of Arise Plus launched today [Friday] will be key for the country to complete its AEC commitments and increase its competitiveness in the region,” he said.
The project will support the Ministry of Commerce, the Ministry of Economy and Finance and other ministries involved in advancing Cambodia’s trade development agenda, and work with the private sector and development partners.
Sascha Reebs, the first secretary of development cooperation at the German embassy in Phnom Penh, said the project would support economic integration in the region.
He said Asean would become a central international player in all fields if it manages to further grow together economically and politically.
“They share joint values and interests in free trade, climate change and rule-based international order,” he said.
According to GIZ, the Kingdom’s overall proportion of domestic trade and domestic investment in the Asean market is one of the lowest in the bloc.
Ministry of Commerce secretary of state Sok Sopheak said the project would enhance Cambodia’s connectivity and integration into the AEC.
“We are grateful also for the support it will provide to SMEs – who are the engine driving future growth in the Cambodian economy,” he said.
Hun Lak, chairman of rice exporter Mekong Oryza Trading Co Ltd, said SMEs lack knowledge related to trade facilitation.
“The project will help the private sector to expand its production chains. It will improve customs and standards. We lack information about tax overlap,” he said.
Cambodia Chamber of Commerce vice-president Lim Heng said the Kingdom’s exports to Asean remain low.
“We mostly export agricultural products and some raw materials to Vietnam and Thailand,” he said.
Heng said Cambodian exports to the bloc account for 20 per cent of total exports, while up to 80 per cent of imports come from Asean, mostly from Vietnam and Thailand.