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Government acts to end monopolies in abattoir business

Sok Chan / Khmer Times Share:
The new directive eradicates exclusive rights to operate abattoirs in Cambodia. KT/Chor Sokunthea

In a bid to increase fair competition in the abattoir business, the Ministry of Agriculture issued a new directive last week that eradicates exclusive rights to operate abattoirs in Cambodia.

The move follows a probe by ministry officials that unveiled that certain abattoirs across the country were taking advantage of their exclusivity to raise prices.

Directive number 115, titled ‘Taking action to strengthen livestock and fishery production management’ and signed by Minister of Agriculture Veng Sakhon, was released on Thursday.

“The government will allow the operation of multiple slaughterhouses in the communes and districts of each province,” the directive read.

“It will also allow people to invest in new abattoirs, which will not face production quotas or limitations regarding the areas they can supply.

“While investors are allowed to expand their businesses, they will not be allowed to sell their business licences to others.

“The government will make public all investment information that pertains to slaughterhouses and conduct bidding processes with total transparency. It will encourage new investment, and invites companies, associations and raisers to invest in their own abattoirs,” it said.

The new regulation also calls for owners of small abattoirs in the countryside to register their businesses with the Ministry of Commerce, setting a grace period of 3 to 5 years to give them sufficient time to comply with all legal requirements, including hygiene and quality standards.

Sen Sovann, director general of the general directorate of animal health and production, said the directive aims to enhance fair competition, create jobs and increase quality standards. He said the consumer will be the ultimate beneficiary of the new policy.

“Provincial agriculture officials and local authorities can now issue abattoirs licences quickly and efficiently,” Mr Sovann said. “This will encourage wholesalers and retailers to create their own products and brands.”

Chet Phirum, deputy director of the Cambodia Livestock Raisers Association, told Khmer Times that the decree will effectively end monopolies in the sector.

“It will make things easier for livestock raisers as they no longer have to depend on a middleman. They can slaughter and sell the specimens themselves,” Mr Phirum said.

“The new directive will also make the price of livestock meat more competitive. In the past, without competition, slaughterhouses could set the price as high as they wanted.”

Small farmers are usually able to sell their pigs for $1.61 to $1.73 per kilogram, while large farms can receive as much as $1.78 per kilogram, he explained.

Mut Pisit, assistant vice president of CP Cambodia, a company that specialises on livestock feed, said his company supports the new directive, and announced that they are now planning to open their own abattoir.

“We are going to open our own slaughterhouse with high standards of quality and safety,” he said.

According to Mr Sovann, there are 200 slaughterhouses of all sizes operating in the kingdom. However, not all of them meet quality and safety standards for the sector, he explained.

“We welcome all new abattoirs in the kingdom, but we ask them to meet our requirements for quality, safety and hygiene.”

“The abattoir business is now open to competition, which will boost investment and quality standards,” Mr Sovann said.

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