Biweekly News Collection No.23

No.23 (Dec 25, 2020)

Market Industry Trends

TOP SIX AGRO-INDUSTRIAL CROPS NET KINGDOM $2.3B IN 2020. Cambodia exported 8.55 million tons of its six most profitable agro-industrial crops, through formal and informal channels, worth more than $2.32 billion this year. The six types of crops are cassava, cashew nuts, mangoes, yellow bananas, peppercorn, and Pailin longan. During the period, Cambodia exported 7,075,494 tons of cassava products (worth $1,026,232,000), 218,884.29 tons of cashew nuts ($288,111,700), 945,274.44 tons of fresh mangoes ($473,207,700) and 313,410.94 tons of fresh yellow bananas ($451,125,700). The Kingdom also shipped out 174.52 tons of Pailin longan (worth $57,763,100) and 5,005.65 tons of peppercorn ($25,490,200). The agriculture sector is a significant engine of economic growth which could enjoy a surge in export figures despite the downturn in the industry and services sectors. According to the Ministry of Economy and Finance, Cambodia exported $14.1 billion worth of goods in the first nine months of this year, up 20.07% from the same period last year. (Phnom Penh Post)

ESTABLISHMENT OF CAMBODIA CHAMBER OF AGRO-INDUSTRY. The Ministry of Agriculture, Forestry and Fisheries has summoned an urgent discussion about a draft law on the Cambodia Chamber of Agro-Industry (CCAI). The discussion aimed to collect inputs to substantiate the draft law to make it complete, effective, and acceptable for all concerned players, especially serving the interests of companies, associations, enterprises, federal unions, agricultural communities, and beyond. The draft law will be a key measure to resolve emerging issues timely and efficiently following the government’s vision for comprehensive reform to boost economic growth. The members of the chamber will play a vital role to transform the crisis into opportunities for agricultural production chain and business development. (Khmer Times)

RUBBER EXPORTS INCREASE IN 2020. Cambodia’s rubber exports are expected to reach 340,000 tons by end of this year. The export figure was reported at around 280,000 tons in 2019. It is projected that the growth rate of rubber export will continue to increase until 2024. Currently, there are more than 410,000 hectares of rubber trees nationwide that are ready for cultivation and approximately 290,000 hectares of rubber trees are capable of being tapped for latex. The price of rubber is also promising up to $1,700 per ton. Cambodia sent around 60% of its rubber production to Vietnam, with most of that remaining exported to China, Malaysia, Singapore, and Europe. (Khmer Times)

BANK GETS LOAN FOR SMEs, BUSINESSWOMAN. Sathapana Bank Plc received a $50 million loan from Proparco, a subsidiary of Agence Francaise de Developpement (AFD) to increase lending by the bank to small and medium-sized enterprises (SMEs) and women entrepreneurs in Cambodia. The loan will be divided equally into two groups: $25 million for supporting the development of the bank’s overall lending activities with SMEs and the remaining $25 million for supporting woman entrepreneurship. It is estimated that approximately 3,600 SMEs will benefit from this loan program, particularly businesses in the retail, services, and agriculture sectors. This credit line will help businesses to sustain themselves and seek new investment opportunities. (Phnom Penh Post)

Macro-economy

WORLD BANK: CAMBODIA’S ECONOMIC GROWTH PROJECTED TO GROW BY FOUR PERCENT NEXT YEAR. Cambodia’s economy in 2020 is projected to register a negative growth of 2% but is expected to bounce back and grow by 4% in 2021, according to Restrained Recovery, the World Bank’s latest economic update for Cambodia. Although total manufacturing exports have been hit by the pandemic and the partial suspension of preferential access to the EU market under the “Everything-But-Arms” initiative, the export of bicycles, electrical parts, vehicle parts, and other accessories are rising. Moreover, there is also a surge in the export of rice and other agricultural commodities. Foreign direct investment inflows to non-garment industries and agriculture projects have also been increasing as a result of the recent bilateral and regional free trade agreement. (Khmer Times)

U.S. TO PROVIDE ADDITIONAL $66.2 MILLION TO AID CAMBODIA’S DEVELOPMENT. The Royal Government of Cambodia and the Government of the United States of America have officially inked the exchange of notes reflecting the addition of $66.2 million to the development project agreement grants for Cambodia. The additional funding will support Public Health and Education ($43.3 million), Agriculture and Environment ($22.9 million), according to the Council for Development of Cambodia (CDC)’s press release. From 1992 to 2019, the U.S. Government provided approximately $1.5 billion in assistance, equivalent to 6.1% of total Official Development Assistance (ODA) disbursement by all development partners to Cambodia, focusing on priority sectors such as health, education, environment, agriculture, governance, democratic development, and de-mining. (Khmer Times)

FRANCE PROVIDE OVER $91 MILLION TO DEVELOPMENT OF AGRICULTURE AND COMBAT CLIMATE CHANGE IN CAMBODIA. The Government of France through the French Development Agency (AFD) is committing 75 million euros (more than US$91 million) for the agricultural development and the fight against climate change in Cambodia. Two financing agreements were signed to support sustainable agricultural and rural development as well as climate-resilient development in Cambodia. The Rural Infrastructure Development for Cambodia (RID4CAM) project will improve access to basic services for rural people and contribute to opening up the most remote areas. The Agriculture Value Chain Competitiveness and Safety Enhancement (ACSEP) project will promote agricultural diversification by supporting five potential sectors (cashew nuts, mangoes, sweet potatoes, poultry, and crops). These projects will be carried out with the German Development Bank – KfW and the Asian Development Bank (ADB).

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