Cambodian economy earns ‘mini-tiger’ recognition

Friday, 27 August 2010

By Jeremy Mullins and Catherine James
Phnom Penh Post

CAMBODIA’S economy has emerged as a “mini-tiger” in terms of textile processing, despite a lack of attention from international investors, according to a report drawn up by Swiss banking giant UBS.

The Kingdom was one of the largest beneficiaries of the decade’s “globalisation boom”, said the report compiled by the Securities Asia division.

“The country has quietly established itself as a mini-tiger in textile processing and assembly, a fact generally overlooked by most investors including ourselves,” the emerging- market report said.

Of 80 emerging countries surveyed by the bank, only six – Cambodia, the Czech Republic, Hungary, Slovak Republic, Thailand and Vietnam
– recorded more than a 25 percent increase in manufacturing exports as a share of GDP from 1997 to 2008.

The report, which described Cambodia’s performance as a “shock”, has drawn support in the Kingdom.

Garment Manufacturers’ Association in Cambodia Secretary General Ken Loo said yesterday the Kingdom was generally an attractive location for foreign investors. With wages for garment workers rising in the China and Vietnam, Cambodia stood to attract additional interest, he said.

“There’s a huge potential here,” he said, although a number of challenges – such as frequent strikes, high electricity costs, and poor infrastructure – needed to be addressed.

Cambodia’s garment exports increased 13.4 percent to US$1.628 billion during the first seven months of the year, according to Ministry of Commerce statistics.

University of Cambodia economics lecturer Chheng Kimlong said yesterday that although the domestic economy was doing well, it was stronger before the financial crisis.