Friday, February 8, 2008

Waiting for Vietnamese enterprises to seek business opportunities

VietNamNet Bridge - In 2007, Vietnam’s investment in Cambodia reached 115 million USD and more investment into the country from Vietnam is expected to increase. Notably, some big Vietnamese businesses have paid attention to the Cambodian market such as the Army Telecommunications Corporation (Viettel), the Vietnam Oil and Gas Group (PetroVietnam), the Vietnam National Coal Mineral Industries Group and the Electricity of Viet Nam (EVN). The following is an interview with Mr. Mao Thora, the Secretary of state of the Cambodian Ministry of Trade about this issue. Could you tell me what incentives the Cambodian government gives to Vietnamese investors to attract more Vietnamese businesses to the country?

Over the past year, Vietnam’s investment into Cambodia has been increasingly aggressive and many big Vietnamese businesses have invested in my country, and some companies have established representative offices in Cambodia to implement their projects. We want big Vietnamese businesses or small-and medium-sized enterprises in the border provinces to seek out investment opportunities in Cambodia. When Vietnamese enterprises invest in Cambodia, they should invest in the country’s special economic zones and we will take advantage of each other, for example, Vietnamese enterprises enjoy tax incentive from the Cambodian government and Cambodia takes advantages of Vietnam’s infrastructure such as ports and roads. Have border provinces in Cambodia established relations with Vietnam to attract investment or not?

According to Cambodian policies, border provinces in Cambodia have established a committee for investment, which is responsible for bringing in investment into Cambodia from neighbouring nations. The committee is in charge of attracting investment from Vietnamese enterprises and is allowed to grant investment licenses to enterprises, which have 2-million USD projects. We have polices but need to realize them effectively. What could you say about the two-way trade between Vietnam and Cambodia in recent times? The total import-export revenue of the two countries in 2007 reached almost 1,200 million USD, what is the real potential? It has increased remarkably and it is thanked to the infrastructure the two governments have invested in to build up in the border areas. In term of commodities, we are trying to rationalize the procedures for importing and exporting a number of products. Over the past time, Vietnam exports clothes and shoes into Cambodia and I think we should diversify imported and exported items between the two countries. Some Cambodia products exported to the world market are obstructed due to regulations on safety or quarantine so we have to export to neighbouring countries such as Vietnam or Thailand where regulations are much more simple. The prices of Cambodian commodities exported to the Thai market are lower than that in the Vietnamese market so a lot of Cambodia’s agricultural products are exported into Vietnam. According to statistics, the import-export revenue of the two countries in 2007 reached 1,200 millin USD, which could be much higher because we did not count commodities imported and exported in small volumes. I suggest that both Ministries of trade should supervise and itemize the total volume of commodities exported and imported across the border so that we can work out measures to promote more trade between the two countries. Smuggling cross border between the two countries is very complex. What solutions does the Cambodian government have to curb this situation? As I said at a conference on Vietnamese-Cambodian trade held on January 15, Directive No. 02 of the Cambodian government focuses on preventing and fighting against smuggling important items such as cars and petrol. In term of cars, we are focusing on car smuggling from western Thailand and petrol from Vietnam to Cambodia. Directive No.02 has been brought in but the issue now is how it is implemented. At the conference, some measures to prevent smuggling were worked out such as simplifying and create better procedures for importing and exporting commodities between the two countries. And we will have to invest in the infrastructure in the border provinces to further promote trade. Additionally, we make an effort to attract more investment to the border provinces to create jobs for local poor people to reduce smuggling.

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