As part of a delegation exploring business opportunities in the kingdom, over 50 business leaders from Hong Kong met with high-ranking Cambodian officials yesterday in Phnom Penh.
For in depth analysis of Cambodian Business, visit Capital Cambodia
The Hong Kong-based companies belong to a wide range of economic sectors, including finance, construction, legal and accounting, as well as manufacturing.
They reach the kingdom only a few months after Asean signed a free trade agreement with Hong Kong and China late last year.
Edward Yau, director of the Chief Executive’s office of Hong Kong, who lead the delegation, said Cambodia is of strategic importance to Hong Kong by virtue of its membership in Asean, a key trading partner of the former British colony.
“We need to strengthen our ability to ensure bilateral agreements and Asean is our second largest trade partner,” Mr Yau said.
“Today, we bring about 50 business leaders from a variety of sectors. We believed they will find Cambodia a suitable partner as we seek to enhance our economic relation with Asean.
“Hong Kong, being a free trade promoter and advocate of strong, rule-based, multilateral trading systems, will continue to take this pathway. We will continue to do our utmost,” he said, adding that they are also interested in becoming a party to the Regional Economic Comprehensive Partnership (RCEP).
The RCEP, a proposed free trade agreement between Asean and Australia, China, India, Japan, South Korea and New Zealand, is still under negotiation, but insiders expect the deal to be finalised by the end of the year.
Cambodian Commerce Minister Pan Sorasak said his government is very interested in strengthening economic ties with Hong Kong, arguing that the self-governing region is the gateway to China, Europe and the rest of the world.
“We thank Hong Kong for the agreement reached last year,” Minister Sorasak said.
“We will continue to seek more business and investment from Hong Kong by connecting Cambodian and Hong Kong companies,” he said, hinting at a possible business matching event that might take place in Phnom or Hong Kong in the near future.
Mr Sorasak said the kingdom is ready to reap the benefits of the new free trade agreement signed between Asean and Hong Kong.
“When the agreement comes into effect, it will improve the flow of investment and trade between both parties, which will benefit the people of Asean. In addition, it will enhance economic connectivity between Asean and Hong Kong through the liberalisation of trade, goods, services and investment.
“Cambodia will benefit from this agreement, as Hong Kong is a huge capital market,” he said.
The Asean-Hong Kong, China Free Trade Agreement and Asean-Hong Kong, China Investment Agreement were signed on November 12 last year on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit.
According to the Cambodian Minister of Commerce, the agreements will provide separate and special incentives for newer Asean member states – such as Cambodia, Laos, Myanmar and Vietnam – to increase economic integration, and expand exports by increasing domestic capacity, efficiency and competitiveness.
Mey Kalyan, senior adviser to the Supreme National Economic Council, told Khmer Times that Cambodia must take advantage of the opportunities presented by the delegation’s visit.
He said Hong Kong is a trade hub and and a transit country for exports, and can play a role in connecting Cambodia to the rest of the world.
“We welcome all investment from this region. Hong Kong has great capital, trade activity, and millions of consumers, and can connect us to international markets.
“Foreign direct investment from this territory is very valuable, but to attract even more we must continue to develop our infrastructure,” he said.
Last year, five Hong Kong companies invested in Cambodia, mostly on garments and travel bags, amounting to nearly $30 million, according to Cambodia’s Ministry of Commerce.
Total merchandise trade between Hong Kong and Asean was valued at $107 billion last year, while bilateral trade in services reached about $15.5 billion in 2015.