[Cambodia's] Potential for more Europe exports

Tuesday, 02 August 2011
Liam Barnes
Phnom Penh Post

CAMBODIAN exporters ought to make further use of tariff-free entry to the European Union, particularly given loosened regulations governing rule of origin, EU officials said at a trade seminar yesterday.

Least Developed Countries such as the Kingdom could export to the EU duty and quota free, as long as the country manufactured 40 per cent of the product’s value, officials said. Prior to January 2011, the bar was higher, at 70 per cent.

“Using garments as an example, with the old regulations, it was only possible to import raw material, but now countries can import parts for the final product,” European Customs administration officer Marie Louise Willemsen said.

The changes had been implemented in order to simplify the regulations and make them “more development-friendly,” she said.

As a Least Developed Country, Cambodia has benefited from the preferential scheme since March, 2001.

But since the January 1 change in regulations, the Kingdom’s exports to the EU had doubled on the same period last year, Delegation of the European Commission Chargé d’Affaires Rafael Dochao Moreno said.

“I would like to see Cambodian exports to the EU diversify, as well as more efforts by the Government of Cambodia towards trade facilitation to be made,” Moreno said.

He added that the high cost of transiting goods via neighbouring countries remained a major impediment.

Another obstacle to the advancement of trade between the Kingdom and the EU were sanitation standards that had to be met, Willemsen said.

“With the loosening of import regulations relating to fish, crustaceans and molluscs, we will attempt to assist Cambodian authorities to achieve the laboratory sanitation standards that are expected by the EU,” she said.

Some foreign companies said the market access afford by the Everything But Arms initiative had led them to set up Cambodia instead of another country.

“We are a Japanese company, but operate here [in Cambodia], as it is easier and cheaper to produce and transport because of the larger labour force and these improved rules,” Kasuga Tadashi, Director of footwear exporter Tiger Wing Company, said.

The firm’s previous focus was the Japanese market, but intends to start exporting to Europe next year due to the relaxed restrictions, he added.