Cambodia- Country Profile
General Information
| Official Name |
Kingdom of Cambodia |
| Capital |
Phnom Penh |
| Land Area |
181,035 sq km |
| Population |
15.4m (2013; IMF estimate) |
| Currency |
1$ CAN = 3494.98 Cambodian Riel (KHR) |
| National Holiday |
November 9th |
| Language(s) |
Khmer (official) 96.3%, other 3.7% |
Source: Economic Intelligence Unit, Bank of Canada (Currency Conversion 15/09/2014)
Political Information
| Form of State |
Multiparty democracy under a constitutional monarchy |
| Head of State |
King Norodom SIHAMONI |
| Elections |
Last: 2013, Next: 2018 |
Source: Economic Intelligence Unit
Economic Information
|
Cambodia |
Canada |
| GDP (PPP) |
$46 billion |
$1,763 billion |
| GDP per capita |
$ 3,019 |
$50,047 |
| GDP annual growth rate |
7% |
1.6% |
| GDP – composition by sector |
agriculture: 34.8%industry: 24.5%services: 40.7% |
agriculture: 1.7%industry: 28.4%services: 69.9% |
| Inflation rate – average consumer prices |
3.2% |
0.96% |
| Main industries |
Tourism, garments, construction, rice milling, fishing, wood and wood products, rubber, cement, gem mining, textiles |
Transportation equipment, chemicals, processed and unprocessed minerals, food products, wood and paper products, fish products, petroleum and natural gas. |
Note: 2013 data estimates in Canadian dollars ($CAD)
Source: IMF World Economic Outlook, World Bank Data, CIA World Factbook, Bank of Canada (Currency Conversion 15/09/2014).
Political and Economic Stability
Following political instability since July 2014, Cambodia’s
business environment is expected to slowly improve in 2015. Cambodia’s last
parliamentary elections were held in 2013 resulting in a struggle between the official party and the opposition. The opposition called for new elections but the government refused, creating a political deadlock. In addition, textile workers have been holding demonstrations to demand for a raise of monthly wages.
According to the International Monetary Fund (IMF) Executive Board
assessment the economic activity of the Cambodia remains strong, mostly due to garment exports, tourism, and construction. Growth is expected to reach a 7.5% in 2014. Due to its economic growth, Cambodia has made significant progress towards achieving the Millennium Development Goals and reducing poverty. Proof of this can be found in the recent World Bank Poverty assessment
report where the country’s poverty rate was halved from 53% in 2004 to 20.5% in 2011. Cambodia is recognized for having one of the best performances in poverty reduction worldwide.
Despite these efforts, Cambodia remains one of the
poorest countries in Asia and long term economic development remains a challenge due to corruption, limited education opportunities, high income inequality and poor job prospects.
Security
The Department of Foreign Affairs, Trade and Development Canada (DFATD) recommends that Canadians exercise a high degree of caution when traveling in Cambodia due to an increase in thefts, robberies and other opportunistic crimes. For detailed and up-to-date information on travel security, please refer to the DFATD
Travel Report for Cambodia.
Trade Information
| Trade Partners & Direction |
2009 |
2010 |
2011 |
2012 |
2013 |
Average Yearly Growth |
| Cambodia Exports to the World |
$5,671 |
$5,757 |
$6,625 |
$7,834 |
$9,520 |
11% |
| Cambodia Exports to the United States |
$1,767 |
$1,962 |
$2,082 |
$2,032 |
$2,238 |
5% |
| Cambodia Exports to Canada |
$291 |
$357 |
$522 |
$598 |
$697 |
19% |
| Cambodia Imports from Canada |
$7 |
$4 |
$11 |
$8 |
$5 |
-6% |
Note: Data in millions of Canadian dollars ($CAD)
Source: Trade Data Online (Industry Canada), Trade Map (International Trade Centre)
Source: Trade Data Online (Industry Canada), Trade Map (International Trade Centre), World Integrated Trade Solution (World Bank), United States Trade Representative
Business Climate
The World Bank’s annual
Doing Business report ranks economies from 1 to 189 (with 1 being the best) on their ease of doing business. In the 2015 report, Cambodia ranked 135 overall and 124 for Trading Across Borders, which measures the ease with which a standardized shipment of goods can be imported or exported across its borders. The average time to ship goods out of Cambodia is a bit higher than the regional average at approximately 22 days, with a low average estimated cost of $960 CAD per 20-foot container. To complete the export process, only 8 forms of documentation are required: Bill of landing, commercial invoice, custom export declaration, export permit, inspection report, insurance certificate, packing list, terminal handling receipts.
Although there are many reputable exporters in Cambodia, Canadian importers should be aware that corruption could be an issue when doing business in the country. Cambodia ranked 156 out of 175 in Transparency International’s 2014
Corruption Perceptions Index where 1
st place indicates least corrupt. Canadian companies are advised to exercise strict due diligence before working with a company from Cambodia to ensure that it is a bona fide and reputable entity. It is suggested that Canadian importers commission a report by a credit information provider to verify the financial strength of the partner.[vc_column_text]
Sustainability Initiatives
The
Garment Manufacturers Association in Cambodia (GMAC) signed an agreement in 2014 with the International Labor Organization (ILO) to support the country’s 500 exporting garment factories in implementing a “zero tolerance policy” on child labour. While the ILO’s estimate that 10% of Cambodian children (aged 5 to 17) could be considered child labourers in all sectors, progress is being made in reducing such cases in the country’s garment factories.
The
Regional Community Forestry Training Center for Asia and the Pacific (RECOFTC) together with the Forestry Administration started a 48 month sustainable forest management project in 2011 called “Sustainable Forest Management and Rural Livelihood Enhancement through Community Forestry and REDD initiatives in Cambodia.” This project will benefit more than 200 communities. The overall objective of the project is to contribute with the achievement of Cambodia’s Millennium Development Goals by enhancing the livelihoods of people who live in forested areas and to provide legal commercialization of forest products through sustainable management.
The
ASEAN Initiative on Environmentally Sustainable Cities (AIESC) was endorsed by the ASEAN Environment Ministers in 2005 and serves to assist ASEAN cities, especially the smaller and rapidly-growing, to pursue environmental sustainability. The programme covers 25 participating ASEAN cities. As participating cities of AIESC, regional activities are focused on these cities, such as to pilot test the revised ESC Key Indicators for Clean Air, Clean Land and Clean Water.[/vc_column_text]
Trade Opportunities
Cambodia’s exports to Canada have grown an average of 25% annually over the past 5 years (2009-2013). The country’s economy is mostly base on the manufacturing of apparel, whoever has recently grown in other sectors including bicycles manufacturing, footwear and textiles. The Government of Canada has reconfirmed its commitment to increase trade ties with the country by opening a
representative office in Cambodia’s capital of Phnom Penh.
1. Garments and Apparel
Cambodian exports to Canada are dominated by apparel, with knitted apparel accounting for 67% of exports or $470 million, and woven apparel accounting for another 22% or $150 million. Cambodia is currently Canada’s third top source for apparel imports in the world, after China and Bangladesh. Many large international
brands have established sourcing arrangements with the country, including H&M, Inditex (the owner of Zara and Primark). Garments represent a top opportunity for Canadian Importers due to the variety of products that can be manufactured in Cambodia such as sweaters, t-shirts, swimwear among others. Cambodia is also eligible for Canada’s Least Development Country Tariff treatment, giving garments from that country a competitive edge through
duty-free and quota-free access to the Canadian market.
2. Footwear
The Cambodian
footwear industry has grown significantly in recent years. Since 2008, the number of footwear factories has doubled, resulting in over 300% growth in footwear exports. Cambodia’s footwear is the 3
rd largest export to Canada, amounting to CAD $47 million in 2013. The main products for footwear include: outer soles made out of rubber and leather uppers. These two products are used in the assembly of shoes and boots.
3. Textiles
Textiles products represent Cambodia’s 5
th largest export from Cambodia to Canada. Exports amounted to $4.9 million in 2013, experiencing a steady increase in growth over the past five years. This category of products include blankets, linens, outdoor and camping textile goods, life jackets and life belts. In particular, Cambodia has the capacity to supply a growing Canadian market for outdoor recreation products, which the
Outdoor Industry Association estimates as a CAD $151 billion market.
4. Bicycles
The manufacturing of bicycles and non-motorised vehicles has become a significant industry for Cambodia’s economy. These products represent the 5% of Cambodia’s total exports to the world. In the Canadian market, Cambodia’s bicycle exports have steadily increased over the past 5 years. In 2013, Canada imported CAD $18 million worth of bicycles and accessories. Cambodia has become the
second largest exporter of bicycles in the European Union after Taiwan, which suggests a greater export capacity to meet demand for bicycles from the active Canadian lifestyle.
TFO Canada Export Offers
TFO Canada provides an information service through TFO Canada ’s searchable
Supplier Database for Canadian importers interested in sourcing products from developing and emerging economies such as Cambodia. This includes practical advice on sourcing from developing country exporters, a customized news bulletin including new leads from Cambodia as they come in, and a searchable database for sourcing new products and suppliers.
Useful Links
Links to Cited Documents
