Tatiana Valovaya, a board member of the Eurasian Economic Commission (EEC), sat down with Khmer Times’ Sok Chan during the first Cambodia-EAEU Forum, an event held on Saturday in Phnom Penh to bring together the business communities in Cambodia and the Eurasian Economic Union (EAEU). The EAEU is an economic bloc established in 2015 and made up of five countries in northern Eurasia: Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia.
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The Cambodian government sees great potential in its economic relation with the EAEU and is now working to boost trade with the Eurasian bloc, which last year amounted to $153 million, a 30 percent increase year-on-year.
KT: What is the current state of affairs between Cambodia and the EAEU?
Ms Valovaya: While the ‘official’ relation between the EAEU and Cambodia started just last year, the connection between Cambodia and certain EAEU member states goes back a long time. There has been warm relations between the kingdom and EAEU governments for many years.
But, yes, last year is when it all officially began. I came here in April 2016 on request from the Cambodian government. We discussed the possibility of establishing closer economic links and decided to sign a memorandum of understanding (MoU).
That MoU was signed in May, during Prime Minister Hun Sen’s official visit to the EAEU. Following the MoU, we established a working group.
The first group meeting was held in February in Phnom Penh, with Tekreth Kamrang, the secretary of state at the Ministry of Commerce, and myself, co-chairing the group. We decided to deepen the dialogue, particularly for trade issues.
In February there was another meeting in Phnom Penh between the chairman of the EEC and Prime Minister Hun Sen and they decided to hold a dialogue that involved the business communities. This eventually became the Cambodia-EAEU Forum.
KT: What results do you expect to come from this forum?
Ms Valovaya: We expect it will be the first but the not last. We are encouraging EAEU businessmen living in Cambodia to establish a council in Phnom Penh that will be tasked with organising this forum on a regular basis to promote trade and economic ties between Cambodia and the EAEU.
KT: What’s your opinion of the local business environment? What are investment opportunities in Cambodia like?
Ms Valovaya: The business sector here is great. Cambodia enjoys robust growth and there are so many opportunities for EAEU enterprises in the kingdom. On top of that, our economies really complement each other: Cambodia produces a lot of products that we need, like certain foods, textiles, etc. EAEU, on the other hand, can supply the agricultural machinery and equipment that the kingdom needs. Opportunities for economic cooperation are limitless.
KT: What sectors of the local economy are EAEU investors most interested in?
Ms Valovaya: Agriculture is the obvious one. Tourism also holds great potential, with many of our businesspeople eying infrastructure projects in this sector. There are other sectors as well teeming with opportunity, like information and communications technology.
KT: What is bilateral trade like?
Ms Valovaya: There is a very positive dynamic. Last year, it increased by 30 percent, reaching $153 million. This is actually quite small and we see a lot of room for growth. During the first nine months of this year, trade grew by 16 percent.
KT: Can we expect a bilateral trade agreement between Cambodia and your bloc anytime soon?
Ms Valovaya: We are not negotiating an agreement at the moment because first we need the consent of our five member states. Forums like this are important to ramp up interest among the business community that will put pressure on the governments to initiate that dialogue.
We don’t have an FTA now, but Cambodia is part of our preferential tariff system and enjoys low tariffs for certain products.
KT: What do you think are the biggest challenges for this trade relationship to continue to expand?
Ms Valovaya: I think the biggest hurdle is a lack of awareness among EAEU businesspeople. Many don’t know about Cambodia and the opportunities the country offers. Hopefully, this forum will become a regular event, and will spread information about the kingdom.