Japan trade escalates in Jan; investment in SEZ urged
CAMBODIA’S earned nearly $120 million from exports to Japan in January, coinciding with efforts by the government and private sector to attract Japanese investors for the planned Cambodia-Japan Special Economic Zone (SEZ).
According to the General Department of Customs and Excise (GDCE), the country’s exports to Japan amounted to $116.88 million last month, an 11.8% rise from $104.59 million in January 2023. Imports from Japan were valued at $42.47 million, a slight increase of 1.6% from $41.79 million during the same period the previous year.
Total trade volume between the two countries reached $159.35 million, marking an 8.9% increase.
Japan currently ranks as the country’s fifth largest international trading partner, following China, Vietnam, the US and Thailand.
Cambodia’s trade surplus expanded to $74.41 million in January, as sales between the two nations constituted 3.93% of the country’s total international trade volume, which totalled $4.057 billion.
Lim Heng, vice-president of the Cambodia Chamber of Commerce (CCC), told The Post on February 18 that international trade, particularly Cambodian exports, has begun to gradually recover after a period of decline due to the global economic crisis.
He said the country currently exports a considerable amount of goods to Japan, predominantly textiles, electronic components and agricultural products.
Heng mentioned that the chamber has established a representative office in Japan’s Sendai region to facilitate the dissemination of information and enhance the country’s appeal to Japanese investors.
“With the increase in production capacity and the quality of Cambodian products, we expect more exports to Japan. At the same time, we also hope to attract more Japanese investors,” he stated.
He added that the rise in the country’s export value is partly attributable to both countries being members of the Regional Comprehensive Economic Partnership (RCEP).
Heng noted that major Japanese investments include Minebea (Cambodia) Co Ltd, which manufactures machinery and motors, a car assembly plant, AEON Mall and various agricultural ventures.
Cambodia’s primary exports to Japan
include garments, shoes, electrical components and agricultural products, while imports from Japan encompass machinery, automobiles and electronics, as per the GDCE.
Prime Minister Hun Manet visited Japan in December 2023 to attend the commemorative summit for the 50th anniversary of ASEAN-Japan Friendship and Cooperation, as well as the 2023 Cambodia Investment Forum.
During the event, he encouraged more Japanese investors to consider opportunities in Cambodia and also called for collaborative efforts between the private sectors of both countries to establish the Cambodia-Japan SEZ.
Sam Soknoeun, president of the Global Real Estate Association, who is exploring the possibility of collaborating on the project, stated that Japanese investment in the zone would consequently encourage even more Japanese backing.
He noted that currently, most SEZs in Cambodia are Chinese-owned, which has led to an increase in Chinese investors establishing factories in the country.
“Most Japanese financing is recognised as reliable. Therefore, if Cambodia has an economic zone operated by Japanese investors, it will create more opportunities to attract Japanese companies to invest here directly,” he stated.
The National Bank of Cambodia (NBC) reported that as of the first quarter of 2023, Japan was the fourth largest investor in Cambodia, with a total investment of 11.3 trillion riel ($2.777 billion), an 11.6% increase from 2022.
This placed Japan behind China, South Korea and Singapore in terms of investment volume. Japanese ventures in Cambodia are primarily in the finance, construction, hotels and real estate sectors.
In 2023, trade volume between the two countries totalled $1.8 billion, a decrease of 7.2% from $1.94 billion in 2022. Cambodian exports to Japan reached $1.17 billion, a marginal increase of 0.2%, while Imports from Japan were valued at $623.6 million, a decline of 18.5%, as per the GDCE.