Trade volume with Indonesia reaches $1.1 billion in 2023
INDONESIA advanced from Cambodia’s 12th to 6th largest trading partner in 2023, with trade volume between the two countries reaching nearly $1.1 billion, marking an increase of almost 15% compared to 2022, as reported by the General Department of Customs and Excise (GDCE).
Bilateral trade between the two nations stood at $1.09 billion for 2023, rising 14.6% compared to $948.53 million year-on-year, representing 2.32% of Cambodia’s total international trade, which totalled $46.83 billion.
Exports to Indonesia amounted to $92.74 million, surging by 151.7%, while imports of Indonesian goods stood at $994.6 million, an increase of 9.1%.
Hong Vanak, director of International Economics at the Royal Academy of Cambodia, told The Post on February 6 that as members of ASEAN and the Regional Comprehensive Economic Partnership (RCEP), trade between the two countries is expected to grow, particularly with the improvement in global economic conditions.
He noted, however, that the country’s significant trade deficit necessitates greater efforts from the government and private sector to produce goods that meet Indonesian demand.
“The increase in trade volume signifies enhanced diplomatic and trade relations between the two nations, but Cambodia needs to exert more effort to bridge the export value gap. Given Indonesia’s large population, it would be beneficial if our goods could penetrate their market more effectively,” he said.
Vanak anticipates that, through the efforts of the public-private sector, the country’s exports to Indonesia will continue to increase in 2024.
In September 2023, Indonesia announced the purchase of 250,000 tonnes of milled rice per year from Cambodia, a move aimed at ensuring food security. Indonesia has also pledged to support Cambodia’s food security infrastructure, including supplying fertiliser and providing training to farmers.
Song Saran, president of the Cambodia Rice Federation (CRF) – the Kingdom’s apex rice industry body – noted that the country has considerable opportunities to boost agricultural exports, particularly milled rice, to Indonesia, ASEAN’s largest economy.
He noted that the first official export of the commodity took place in early November.
Saran added that the quality and international recognition of Cambodian milled rice, evidenced by awards in international competitions, have contributed to the growth in exports.
“Exports to Indonesia reflect the development of Cambodia’s rice sector through the implementation of a government-to-government cooperation strategy,” he said.
Indonesian ambassador to Cambodia Santo Darmosumarto, in a recent meeting with Minister of Economy and Finance Aun Pornmoniroth, emphasised the increasing importance of trade cooperation between the two countries.
However, he acknowledged that Indonesian businesspeople seemed unaware of the investment potential in Cambodia, which contributes to the persistent trade deficit.
He suggested that to strengthen economic ties, both nations should consider establishing bilateral payment systems and initiating direct flights between major tourist destinations of both countries.
“There is considerable potential for cooperation between Cambodia and Indonesia, which we must develop and strengthen by leveraging the close historical ties between our nations. Our goal should be to transform these historical ties into robust trade, investment, cooperation, tourism and socio-cultural connections,” said Darmosumarto.