According to the Ministry of Commerce, the value of Cambodia’s international trade surged to 22 billion USD last year on double-digit growth of both imports and exports. The figures show total exports topped 10 billion USD in 2016, an 18% increase over a year, while imports grew to 12 billion USD, a 16% year-on-year increase.
9 billion USD of goods, 90% of all exports, were shipped under the Most Favored Nation (MFN) schemes, which allow Cambodian products to enter markets with reduced tariffs. Of these, garments accounted for 6 billion USD and footwear for another 700 million USD, with another 100 million USD in textile products. The remainder comprised 300 million USD in rice and 2 billion USD of other products.
Total exports to the European Union, Cambodia’s biggest market, rose to top 4 billion USD. Strong growth was also recorded in exports to Japan, increasing by 45% to 800 million USD, and China, rising by 50% to 600 million USD. By contrast, exports to the United States remained flat at 2 billion USD.
Meanwhile, leading imports included raw materials to feed the garment industry, vehicles and fuel products. Imports from China rose by 16% last year to 5 billion USD. Imports from Thailand and Vietnam increased by 22% to 2 billion USD and 53% to $1 billion, respectively.
The agricultural sector has taken on a marginal economic role in recent years. The sector will expand by only 2% this year, and remains a crucial source of income for the country’s rural poor. However, even with preferential trade privileges that have helped swell rice exports to the European market, Cambodian producers must improve quality and slash production costs to remain competitive.
The country’s 2 billion USD trade deficit was expected for a country in the throes of rapid development. For now, Cambodia needs many imports such as machinery and construction materials, which are required for the construction of manufacturing facilities and other business operations.
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