Cambodia is committed to harnessing the potential of the ASEAN-China Free Trade Agreement (ACFTA) to maximise economic benefits and implement structural reforms that promote, encourage and facilitate trade, investment and business.
Minister of Commerce Pan Sorasak made the remark via video link on July 13 at the physical and online FutureChina Global Forum (FCGF) 2021 organised by Singapore.
The minister said the Kingdom is exploring new initiatives to strengthen and facilitate ASEAN-China trade and investments flows and enhance the business environment, including possibilities offered by the ACFTA Upgrading Protocol to provide market access at higher standards and develop a more comprehensive and open trade policy.
Moreover, with the Regional Comprehensive Economic Partnership (RCEP) agreement approaching ratification, the potential to expand and strengthen ASEAN-China economic and trade relations will be “unlimited”, since the trade deal represents one-third of global gross domestic product (GDP) and 30 per cent of the world population, he claimed.
He also highlighted that this mega trade agreement is modern, comprehensive and high-quality, and more importantly – it will help reduce trade costs for businesses and further integrate ASEAN in the global supply chains, including those for electronics, vehicles, garments and other textile products.
“In Cambodia, as a member of the ACFTA, we have always committed to implementing this agreement to get maximum benefits,” Sorasak said, adding that the Kingdom’s government has instituted a slew of reforms designed to promote and facilitate trade, investment and business.
The government has developed and operates a number of automated platforms, including electronic systems for the registration of businesses and qualified investments, tax payments, and intellectual property filings; a digital platform for the issuance of certificates of origin; and the Suppliers Database with Sustainability Dimensions (SD2).
As for financial sector reforms, the National Bank of Cambodia and the People’s Bank of China have agreed to start trading in Cambodian riel on the interbank market in the Guangxi Zhuang Autonomous Region, and the currencies of both countries have been permitted in Cambodia-China trade and investment since 2017.
In addition, online payment services like Alipay and WeChat Pay – catering to Chinese and other tourists – are allowed in Cambodia.
The minister noted that over the past 30 years, ASEAN-China trade relations and economic cooperation have continued to flourish, and that China has been ASEAN’s largest trading partner since 2009.
The total merchandise trade between ASEAN and China stood at $507.9 billion in 2019 and foreign direct investment (FDI) flows from China to the bloc clocked in at $8.97 billion, according to ASEAN figures.
Sorasak suggested that this data “signals the great importance of the economic development contribution from China in the region”.
Held from July 12-13 under the theme “Elevating ASEAN-China Economic Collaboration in the ‘Never Normal’”, FCGF 2021 comprises the main programme, virtual exhibition and exclusive closed-door discussions, as well as physical and virtual networking.
The forum focused on the trends, growth opportunities and lessons drawn from ASEAN and China, and set out to provide participants a sharper understanding of the latest developments and better anticipation of emerging trends that will position regional companies in capturing business opportunities.
FCGF said that with “strained bilateral relations exacerbating bifurcation”, China is being driven to minimise its reliance on the US.
“Keeping this guiding focus in mind, China has rolled out a plethora of policies, notably ‘Dual Circulation Strategy’ and ‘RCEP’ amongst others.
“Through these policies, China is seeking to independently develop her own platforms, ecosystems, semi-conductor chips, infrastructure and more, heralding a new era for the international order,” it said.