About 16 giant US companies have returned to the US after exploring business and investment opportunities in the agriculture sector in Cambodia.
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They are Alltech, Amazon Web Services, Archer Daniels Midland, California Figs, Corteva Agriscience, DTN, IBM, Idaho-Asia Trade Office, John Deere (RMA), Khai Anh Binh Thuan Import Export Trading, Missouri-Asia Trade office, Planet.com, Sripipat Engineering Co, US Grains Council, US Highbush Blueberry Council and Vi Na Dai Import and Export.
Speaking at the Business Opportunities in Agriculture Trade Event at Rosewood Phnom Penh, W. Patrick Murphy, US ambassador to Cambodia, said that this is the second year in the row that the US embassy is working with US government entities has brought trade delegations to the Kingdom of Cambodia to explore opportunities in the agriculture sector.
“This is the largest US trade delegation to Cambodia in recent history and it represents some of the best of the American companies, the big agriculture giant, such as John Deere, the big technology companies such as IBM, Amazon and others who can bring technology to helping Cambodia advance to the next level of development,” said Murphy.
He said that the trade delegation, which returned last Saturday, took place in the context of an exciting year as the US and Cambodia commemorated 70 years of the anniversary of establishing diplomatic relations this year. The US is focusing each month on different themes that capture the collaboration and cooperation.
He said that agriculture is enormously important for Cambodia and economy and Cambodian culture – and also important for the United States.
Murphy added that when US companies come as a delegation like this, they are looking for opportunities in the market in Cambodia for their products and services, but they also bring opportunities for Cambodia to help the Kingdom to meet its need as the country economy grows: Agriculture needs to become more efficient, more tech savvy and the opportunities for US companies to work with their counterparts here to help the country advance.
Agriculture accounts for 22 percent of Cambodia’s gross domestic product (GDP) and employs about 3 million people. Agricultural exports, including rice, cassava, maize, pepper, fresh mango and raw palm oil – reached 4.2 million tonnes in 2018.
US-Cambodia agriculture trade is about $220 million per year, with lots of potential for growth. Cambodia’s agriculture exports to the United States were $157 million in 2018, a new record. Most were wood products ($134 million), followed by pet food and rice. US exports of agricultural products to Cambodia were $62 million in 2018.
The US ambassador to Cambodia said that US companies are also focusing on communities and explaining standards that need to be met, sustainable development, cultural awareness and contributing to the community where they are doing business.
“As the economy becomes more closely integrated, you have the presence of more companies here. These companies demand high standards. They want to see efforts to cut back on corruption, to increase transparency, to adhere to the rule of law, to protect their business interests, so the more companies you have expecting those fundamentals, the better the results for Cambodia to continue to develop and try to strengthen those areas,” he added.
“The good news from Cambodia is that the country produces a lot of agriculture products that we like in the United State and these are growing, such as rice, cashew nuts, mangos, other fruit. We hope there will be increasing exports,” said Murphy.
“I like Kampot pepper, mango, passion fruit. I hope more can find it in the American market and I hope Cambodia can provide added-value products, develop manufacturing of these products. You gain economic advantages by producing final products that are ready to sell in the United States,” he added.
Allen Dodgson Tan, chairman of the board of the American Chamber of Commerce, said that in Cambodia the agriculture sector has entered into a new chapter that involves increasing investment and new technology and creating the infrastructure needed as well as access to the global market.
He said agriculture will not only diversify the economy, but also increase food security for Cambodia and the region. Cambodia has many potential products of high value globally, such as rice, cashew nut and pepper. These products are recognised all over the world.
“Our role is to advise American businesses and also help them to reach their goals here in the country – policy goals, business goals. In the case of agriculture we see the opportunity for American companies to come to Cambodia and assist in setting up new companies, to bring equipment,” he said.
Minister of Commerce Pan Sorasak said that Cambodia is, first and foremost, an agriculture country that has 78 percent of the population living in rural areas. He said that in terms of economic contribution, the agriculture sector share of GDP accounted for 22 percent in 2018, mainly from crops such as rice, corn, soybeans, cassavas, mangos, cashew nuts, rubber, vegetables, as well as livestock and fish. On the other hand, industry and services shares in the GDP were 32.29 percent and 39.49 percent, respectively in 2018.
In terms of bilateral trade relations, trade flow between Cambodia and the US has increased significantly since 2013. In 2018, bilateral trade volume rose to $4.3 billion, an increase of 22.23 percent compared with 2017. As of November 2019, trade volume between the two countries accounted for $5.4 billion, an increase of 27.4 percent compared with 2018. This is seen as a very positive sign for trading relations.
Products exported from Cambodia to the US include garments, shoes, textiles, rice, furniture, plastics, toys, rubber, cereals, ceramic products, wood and wooden articles, live animals and animal feed, among other items. Conversely, Cambodia imports from the US are vehicles, machinery, medical and electrical apparatus, textile articles, paper, edible fruit and cereals.
In terms of agriculture trade, Pan added the US total exports of agricultural products to Cambodia totalled $62 million in 2018 which is a decrease of $11 million compared with 2017.
Most of the exports from the US to Cambodia are soybean meal, valued at $13 million, distiller grains, $12 million, prepared food, $6 million, beef and beef products, $5 million, and hides and skins, $4 million. In return, Cambodia total exports of agricultural products to the US totalled $24 million in 2018 representing an increase of $2 million compared with 2017.