The part in relation to Cambodia under the ASEAN-Hong Kong free trade agreement (FTA) and Investment Agreement (IA) is set to take effect on February 12, according to Hong Kong’s Trade and Industry Department.
The Kingdom will be last country in which the two agreements enter into the force, following Indonesia on July 4 and Brunei on October 20, the department said in a press release, citing an unnamed government spokesman.
He said in the release: “Hong Kong enterprises and service providers will be able to enjoy the full benefits as committed to by all 10 ASEAN member states under the agreements. Their business opportunities in ASEAN markets will be greatly enhanced.”
“Hong Kong forged the FTA and the IA with ASEAN in 2017 and the agreements have entered into force gradually since June 2019.”
“The agreements are comprehensive in scope, encompassing trade in goods, trade in services, investment, economic and technical cooperation, dispute settlement mechanisms and other related areas.”
Pen Sovicheat, undersecretary of state at the Cambodian Ministry of Commerce, told The Post that internal procedures would be finalised soon, expressing hopes that the Kingdom will benefit from the Hong Kong market through the agreements.
He said: “We have already signed the agreements. We will formally issue a notification once internal procedures have been completed so that both parties can implement them immediately.
“We hope that these agreements will enable Cambodia to capture some of the export market in Hong Kong.”
According to the Hong Kong government spokesman: “As far as Cambodia is concerned, it will progressively reduce and eliminate customs duties on goods originating from Hong Kong.
“The tariff commitments made by Cambodia cover different kinds of Hong Kong commodities, including jewellery, articles of apparel and clothing accessories, watches and clocks as well as toys.
“To enjoy the preferential tariff treatment for exporting Hong Kong goods to Cambodia under the FTA, Hong Kong traders have to comply with the relevant preferential rules of origin and fulfil the related requirements.
“[They must] apply for certificates of origin from the Trade and Industry Department or Government Approved Certification Organisations to cover the goods concerned.
“On trade in services, Hong Kong service providers will enjoy legal certainty in market access for an extensive range of services sectors in Cambodia.
“Under the IA, Cambodia will provide Hong Kong enterprises investing in its area with fair and equitable treatment of their investments, physical protection and security of their investments, and the assurance of the free transfer of their investments and returns.”
Cambodia Rice Federation president Song Saran said that while Hong Kong importers maintain rather strict conditions, they are regular buyers of Cambodian milled rice.
He said: “In my view, Cambodia participation in the Hong Kong-ASEAN free trade market will be akin to having a Hong-Kong-Cambodia one. This’ll make our products more competitive on the Hong Kong market and will help bolster the presence of our food-processing and all manner of other industrial sectors there.”
ASEAN was Hong Kong’s second largest trading partner in merchandise trade in 2019 and the fourth largest in services trade in 2018, according to the Hong Kong government spokesman.
Total ASEAN-Hong Kong merchandise trade stood at HK$1.018 trillion (US$131 billion) in 2019, while total services trade between the two sides was to the tune of HK$137 billion in 2018, he said.