Internal reform needed to survive tariffs: Ministry

Sok Chan / Khmer Times No Comments Share:
The EU has imposed tariffs on Cambodian rice. KT/Mai Vireak

With the recent imposition of tariffs by the European Union, the local rice sector needs to focus on enhancing competitiveness by increasing efficiency and reducing costs, the Ministry of Agriculture said in a statement this week.

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Creating a high-quality fragrant rice seed must also be a priority, the ministry noted, calling on government agencies and research institutes to continue studies and on the private sector to help fund this research.

The statement highlights the need to streamline import procedures for fertilizers and pesticides, as well as to reduce the time it takes to conduct quality inspections, which will save exporters time and help them reduce costs.

“Exporters must ensure the purity of their fragrant rice and make sure it is not mixed with other varieties,” the statement reads. “This is necessary to protect trust on our products.”

According to the statement, the ministry will provide technical support to industry players to increase yields and slash expenses.

The announcement mentions that the European Union re-imposed tariffs on rice imports from Cambodia this month, adding that the tax will make Cambodian rice more expensive and thus less competitive in Europe.

“To face the new tariffs imposed by the EU, the sector must strengthen the competitiveness of their products and reduce production costs,” the announcement notes.

Chan Pich, general manager of Signatures of Asia, told Khmer Times that the government must help industry player reduce costs.

“The government should consider lowering electricity tariffs, while encouraging lower interest rates and lower logistics costs.

“We also ask the government to build warehouses near railway stations, which will facilitate the transport of rice,” Mr Pich said.

Ouk Makara, director of the Cambodian Agricultural Research and Development Institute (CARDI), a body of the Ministry of Agriculture, told Khmer Times that his institution is working on creating high-quality fragrant rice seeds.

He said the institution has already produced a foundation seed resilient against droughts and floods.

Last year, Cambodia exported 626,225 tonnes of rice to international markets, a drop of 1.5 percent compared to 2017.

Local firms exported mainly three types of rice: fragrant rice (493,597 tonnes shipped, or 78.82 percent of total rice exports), long-grain white rice (105,990 tonnes, or 16.93 percent), and long-grain parboiled rice (26,638 tonnes, or 4.25 percent).

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