Siam Cement sales jump in Cambodia
Apple reaches 500M tax settlement with France
THAI construction materials producer Siam Cement Group Public Company Limited (SCG) reported strong business growth in Cambodia last year, as revenue from its subsidiaries’ sales in the Kingdom enjoyed double digit growth.
According to an SCG press release on Wednesday, revenue from sales in its Cambodia operation rose to $396 million, a 15 per cent jump compared to sales revenue in 2017. The total sales revenue last year was contributed mostly from the firm’s flagship product, cement.
“SCG will continue to expand opportunities to export innovative products and services following up on the global market direction to meet the consumer needs,” SCG president and CEO Roongrote Rangsiyopash said in the release.
The firm’s representative could not be reached for further details about the source of revenue from last year’s sales.
Demand for construction materials
SCG currently has six subsidiaries firms in Cambodia – Kampot Cement Co Ltd, SCG Concrete Roof (Cambodia) Co Ltd, CPAC Cambodia Co Ltd, CPAC Plank Cambodia Co Ltd, NAWA-CAM Co Ltd and SCG Trading (Cambodia) Co Ltd.
Cambodia Constructors Association general manager Chiv Sivpheng said demand for construction materials has been increasing annually as the Kingdom’s construction industry grows. With increasing population and urbanisation, Sivpheng said the construction industry is expected to continue expanding and benefit local producers.
“The outlook for the Cambodian construction sector will remain good and [the expansion] will provide significant opportunities for local producers to set up production or expand production lines to obtain advantages from the trend,” he said.
According to Sivpheng, cement is one of few items that construction companies can obtain from local producers, while they must rely on imports for many other construction materials.
There are currently six licensed cement factories in the Kingdom, with four of them in operation. The final two are expected to activate their pro- duction lines this year. According to the latest Ministry of Industry and Handicraft figures, the four licensed cement factories produced 3.6 million tonnes in the first nine months of last year.
The four are Kampot Cement (2.21 million tonnes), Cambodia Cement Chakrey Ting Factory Co, Ltd (1.22 million tonnes), Chip Mong Insee Cement Corporation (119,000 tonnes) and Battambang Conch Cement Co Ltd (11,000 tonnes).
The Ministry of Land Management, Urban Planning and Construction’s 2018 annual report showed that 2,867 projects were approved last year with a value of $5.23 billion, down 18.6 per cent on $6.42 billion in 2017.
The report also showed that the number of investment projects approved in 2017 was 3,052. APPLE said on Tuesday that it had reached an agreement with French authorities to settle 10 years of back taxes, becoming the latest US company to make a deal with France, which has led a European push for higher taxes on tech giants.
Apple paid nearly € 500 million ($570 million) to resolve the case in a confidential settlement reached in December, a source familiar with the case said, confirming a report in French news weekly L’Express.
“The French tax administration recently concluded a multiyear audit on the company’s French accounts and an adjustment will be published in our public accounts,” Apple said in a statement.
“We know the important role taxes play in society and we pay our taxes in all the countries where we operate, in complete conformity with laws and practices in force at the local level,” the company said.
French authorities declined to comment further, citing the confidentiality of tax matters.
French tech tax looms
Apple is one of several US technology giants in the line of fire in Europe over their tax strategies, which see them route their income through low-tax nations such as Ireland or Luxembourg.
In 2016, it was ordered by the European Commission to pay € 13 billion in back taxes to Ireland.
The European Commission said Apple paid an effective corporate tax rate of just 0.005 per cent on its European profits in 2014 – equivalent to just € 50 for every million.
The deal in France comes as the government prepares to push ahead with its own unilateral “Gafa tax” – an acronym of Google, Apple, Facebook and Amazon – faced with the failure of EU members to agree on how to get technology companies to pay more tax on their European operations.
The levy, to be put to parliament in a bill this month, would affect companies with global sales of more than € 750 million and € 25 million in France.
It would be retroactive to January 1 and is expected to raise € 500 million this year.
French Finance Minister Bruno Le Maire has called the question of how and where global companies pay their taxes “a major issue in the 21st century”.
But an agreement among EU members has proved elusive.
Ireland, Denmark and Sweden have all blocked plans for a levy for fear of dissuading investment, and Germany has proved lukewarm on the issue, fearing US retaliation against its car industry.
The issue has been referred to the Organisation for Economic Cooperation and Development, which aims to come up with an international agreement by 2020.
According to L’Express, the deal between France and Apple was clinched after several months of talks, and concerned the small amount of revenue the firm booked in France even as the sales it reported in Europe ballooned.
The report said Apple’s European revenues exploded seven-fold, from € 6.6 billion in 2008 to € 47.7 billion in 2017, most of which was booked in Ireland where Apple has its European headquarters.
At 12.5 per cent, Ireland’s corporate tax rate is much lower than in France, where companies pay 33 per cent tax on their profits.