Sunday, September 27, 2009

1,500 U.S soldiers to join military exercise in Cambodia next year

PHNOM PENH, Sept. 26 (Xinhua) -- About 1,500 U.S. military men are expected to join military exercise which is planned to take place in Cambodia in the middle of next year, Cambodian military official said Saturday.

Gen. Chhum Socheat, spokesman of National Defense said that more than 2,000 military men are reserved for the first-ever event in the country and they will come from more than 20 countries, of which 1,500 will be from the United States.

The military exercise which is to be supported by the United States under a program titled "Global Peace Operations Initiative or GPOI" will take place in June or July next year.

According to the plan, the military exercise will be conducted in Phnom Penh and in Phnom Sruoch district in Kompong Speu province, about 90 kilometers from the capital, the officials added.

On Wednesday, the U.S. Embassy in Phnom Penh issued a statement saying during a four-day visit to Washington D.C. , Tea Banh, Cambodia's Deputy Prime Minister and Minister of National Defense had met with U.S. Deputy Secretary of State James Steinberg and discussed security cooperation between the United States and Cambodia.

During the meeting, they also highlighted Cambodia's ongoing support for international peacekeeping operations and Cambodia's commitment to hosting the 2010 Global Peace Operations Initiative (GPOI) regional capstone exercise.

GPOI is a U.S.-funded G-8 program to expand global capacity to train and equip 75,000 peacekeepers by the year 2010, the statement said.

Peace Operations Initiative was established after the 2004 G8 Sea Island Summit to address growing gaps in international peace operations. The goals of GPOI expand upon the goals of the Sea Island Action Plan. GPOI built policy based on previous peace operations capacity-building programs.

Saturday, September 26, 2009

Boosting investment in Cambodia



By Steve Finch

Ajinomoto's Cambodia President Ichiro Nishimura says that although Cambodian officials still demand bribes, in other respects the country is no longer a pariah among foreign direct investors.

It was difficult to convince the Tokyo top management [to invest in Cambodia]....

Ajinomoto has recently signed a deal to construct a packing factory in the Phnom Penh Special Economic Zone (PPSEZ) starting next month. What prompted the company to expand beyond the distribution operation you first set up in 2001?
Cambodia is between Vietnam and Thailand.… We [already] have big business between Vietnam and Cambodia, and between Thailand and Cambodia.

Actually, we import … and sell here, but this country has big potential due to economic progress and stable politics, and most Cambodian people … are young.

According to economic growth, people’s eating habits, [their] lifestyle should change – such as KFC. It has already changed.
So, if we make the decision to invest in Cambodia … we see [the potential for] a suitable factory. Phnom Penh Special Economic Zone has [the necessary] infrastructure and … incentives.

So what incentives has Ajinomoto received to set up at the PPSEZ?
The maximum nine-year tax holiday. And construction materials, free import tax and free VAT – this is on construction, on investment such as machines or steel structures, things like this.

Ajinomoto has already invested heavily in neighbouring Thailand and Vietnam. How do the tax incentives for foreign investors here compare to the Kingdom’s ASEAN neighbours?
I don’t exactly know [the details of incentives] in Thailand and Vietnam, but the Cambodian government supports [us] – especially the CDC [Council for the Development of Cambodia]….

It’s very attractive support – [there is a] one-stop service from the CDC.

Before coming here … [Ajinomoto thought that] Cambodia was very complicated, that there was a lot of under-the-table money, something like that. We were a bit concerned.

But actually when we came here, it was very supportive. The top of the government was very supportive. For example, tax is a very complicated issue, but the top made it very clear … step-by-step.

But the next position [down in the hierarchy] doesn’t understand that policy or rule.… Their thinking method is very old-fashioned.

You mentioned that Cambodia has a reputation for corruption when it comes to foreign investment. Have you seen it at the lower levels of government here?
Yes, before. But actually, in Japan, if you’re talking about our Tokyo headquarters – my boss or our top management in Tokyo – if you ask them, “Cambodia, what do you think of Cambodia”...?

It was difficult to convince the Tokyo top management [to invest in Cambodia]; it took a long time.
But they came here to see the market and to meet the authorities. They found it easy to understand and then dramatically changed their minds.

But are Cambodian officials at the lower level still asking your company for bribes?
Yes, they still are. This kind of experience in most developing countries is a very common issue....
This still exists, but generally if a foreign company invests in Cambodia, they needn’t be afraid of such things as country risk, collapse, no system....
I clearly say there is no need to be afraid [of Cambodia].

Ajinomoto has plans for a packing factory in the PPSEZ that will import raw materials. Are there also plans to begin manufacturing in Cambodia?
According to our plan, we will start from June next year … start test production in June.

It means this company will combine with a new company. Sales activities from the new company will start from September 2010.
Ajinomoto … will import [raw materials] from Thailand or import from Vietnam, or import from other countries.

We are now studying the most suitable supply chain, which country is the most suitable. Anyway, we import from other countries … in bulk, and we will pack for the first stage.

And the second stage, we will make these products [Nishimura displays a sachet of processed food produced by Ajinomoto]…. It will be mixed here and packed here – for the second stage.

Cambodia has routinely been unable to produce the necessary raw materials for its own industries. To what extent is that putting off multinational companies from investing here?
[One factor] is the exchange rate … and another is AFTA, the ASEAN Free Trade Agreement.

Actually, import tax may be [abolished] in 2015, according to the ASEAN Free Trade Agreement.
In 2015, among the ASEAN countries, there will be free trade – it means import tax is zero.

Still, I hear from the Cambodian authorities … [regarding] Cambodian tax, 19 percent comes from import tax and VAT.

So it means that if Cambodia has no import tax, it will cut [the country’s revenue].
But for the next few years it will directly affect our business.

Research by the UN Development Programme, among others, has shown that Cambodian productivity in the work place and vocational skills are a long way behind the likes of Vietnam and Thailand. Does this concern multinationals like you when you are deciding whether to invest here?
Vietnam 10 years ago was similar to Cambodia and was doing very well, so 10 years later we can catch up with Vietnam’s current level.
So, over time … Cambodia’s level [of labour skills] is becoming higher.

There is a lack of marketing data here to help companies like Ajinomoto identify who its likely customers are and how many of them are in Cambodia. How have you been able to say for certain that you want to enter Cambodia and that you have a potential market here?

We have done market research … by myself, and we have a marketing research company. We have data.

If you compare it to Thailand, with the data quality there is a very big difference, but our products are very basic, such as MSG.
Every Cambodian person eats MSG … so we are at the very basic stage.

If we create a higher-level product, maybe we would need more information, but in the current situation it is enough.

Tuesday, September 8, 2009

Cambodian FM, U.S. Secretary of State to meet at NY for deepening bilateral ties

PHNOM PENH, Sept. 8 (Xinhua) -- Cambodian Deputy Prime Minister and Minister of Foreign Affairs and International Cooperation Hor Namhong said on Tuesday that he plans to meet with his American counterpart Hillary Clinton in New York during his stay there.

"So far, both sides have plan to meet to strengthen the bilateral cooperation and relationship between the two countries during I stay there to join the UN General Assembly late this month," Hor told reporters at his ministry after signing agreements with the U.S. to receive over 34 million U.S. dollars assistance for health and education improvement.

"I and my American counterpart are busy at the U.N. General Assembly but both sides plan to seek appropriate time for talking to deepen the bilateral relationship," he said, adding that "I have just talked with U.S. Ambassador to Cambodia (Carol A. Rodley) briefing about the time of the bilateral talks."

Hor Namhong said he plans to leave Cambodia on September 22 for New York to join the U.N. General Assembly.

Since 1999, the U.S. has provided over 250 million U.S. dollars for health and education system improvement in Cambodia. "We highly appreciated with the assistance from the U.S.," he added.

"The bilateral relationship between the two countries are getting better and better and moving forwards," Hor Namhong said, citing that "the U.S. sent their Peace Corps to help local Cambodians, lifted Cambodia from trade blacklist and provided military assistance to Cambodian armed forces." Last week, the U.S. offered over 6.5 million U.S. dollars worth of military equipment and technical assistance to Cambodian Royal Armed Forces.

Cambodia provides land for retired armed forces: PM

PHNOM PENH, Sept. 7 (Xinhua) -- Cambodian Prime Minister Hun Sen said Monday the government will provide land for families of retired armed forces including military police, police, and solders for planting agricultural corps.

"It will be a big system of social safety and welfare for retired armed forces and we want to transfer the non production forces to the production forces because they have land for planting agricultural crops to survive as pension," he said at the ceremony of releasing the final result of 2008 population census.

"With the land, those armed forces will not be fallen into poor after they retried from the positions," he said, adding that we need at least 30,000 or 40,000 hectares of land for those armed forces.

"Those plots of lands will come from the economic concession land which private side did not follow the contract and were taken back by government to be transferred into social concession land for armed forces," Hun Sen said, adding that Ministry of Economy and Finance will organize the project with the legal regulations.

Khieu Kanarith, government spokesman and information minister said that the retired armed forces will not be allowed to sell, transfer or rented those land but they have to plant agricultural crops for their living conditions.

The soldier families will get a plot of land about a hectare or two hectares.

The 2008 Cambodia Population Census Released

According the press release from the National Institute of Statistic, Ministry of Planning that the 2008 Cambodia Population Census has been releasedyesterday (September 07, 2009) by the Prime Minister Hun Sen at the Chaktomuk Conference Hall.

The new census final results revealed that Cambodia population has increased from 11.4 million in 1998 to 13.4 million in 2008. The population density increase from 64 to 75 persons per square kilometer and the annual growth rate declined from 2.49% in 1998 to 1.54% in 2008. The number of literacy population aged 7 and more has spectacularly increased from 62.8% in 1998 to 78.35% in 2008. The adult literacy rate has shown fairly good increase to 77.59% in 2008. The number of children aged 6 and more attending school or educational institution have increased from 36.27% in 1998 to 2008 but the proportion of females attending school continue to be less than the corresponding proportion for males both in the urban and rural area.

Categories: Education

Cambodia seeks to attract more foreign investments

Cham Prasidh, Cambodia's Senior Minister and Minister of Commerce
By Channel NewsAsia's IndoChina Bureau Chief Anasuya Sanyal

Posted: 07 September 2009

PHNOM PENH: Cambodia is open for business, despite global economic uncertainty and a negative growth forecast. For foreign investors in the country, the downturn could be a moment of opportunity.

Cambodia has not been spared by the economic crisis - exports have dropped by 23 per cent and the construction industry has slowed almost to a standstill. But it will take another quarter to determine any negative long-term economic effects.

The country's Commerce Minister Cham Prasidh is confident that demand will pick up again, especially in the hard-hit garment sector. He explained why the country is a perfect springboard to foreign markets.

"Cambodia is a less developed country. We enjoy market preferences larger than our neighbouring countries which are developing countries. It means that products that you can produce in Cambodia go to Europe duty free and quota free," he said.

Fund manager Doug Clayton dispels some common misperceptions regarding investing in Cambodia.

He said: "Many investors think Cambodia's an unstable place, but personally I think it's one of the most stable countries in Southeast Asia because it has had the same government for over two decades and is unlikely to change over the next ten years."

A 15 per cent corporate tax rate and various government incentives have made CEOs like Johnny Ong of Singapore's HLH confident of its success. The company is expected to put US$40 million into its corn agribusiness over the next few years.

HLH said it can import expensive farm equipment and seed stock from abroad tax free. Local labour is easily available and there is plenty of land to lease – 7 million hectares over the whole country.

Sunday, September 6, 2009

Traffic in Phnom Penh Cambodia?

By Fred Tittle

Traffic in Phnom Penh may look like an accident waiting to happen, but step outside the law and it will cost you a lot of time and money.

Anyone who has been on Cambodian streets on two, three or four wheels knows it's a free-for-all affair. There are city ordinances that seem only to be enforced when the boys in blue are near enough to evaluate the worth of stopping a violator. And like it or not, the foreigner is viewed through lenses embossed with a dollar sign and he/she will often be stopped for what seems to be the most mundane of reasons.

Just the other week my wife was stopped car for having "a dirty vehicle". Technically there is no law against having a dirty vehicle, as you can probably gather from some trucks that are so covered in provincial red dirt or general grime that it is impossible to identify the original colour. Needless to say she handed over the demanded $5 fine, largely because our daughter was in the vehicle and it wasn't worth fighting it out in the midday heat.

En passant so to speak. Drivers who are stopped by the police and want to persuade them to obey Cambodian law, point out that no traffic fine for a car or pickup truck can exceed 10,000 riel, which is about $2.50. As for motorcycles, it is a manageable 5,000 riel for major violations and 2,000 riel for crimes such as running a red light. If more than those sums are demanded, it's up to you to argue or pay up.

Despite the current chaos and horror stories, though, there are traffic laws here. A full set of rules was passed by parliament in December 2006 and they are very slowly being enforced.

Strangely for Cambodia, unnecessary noise is included in the ordinances as the use of your horn is allowed only at daytime in order to inform road users of a traffic accident.

Vehicles 49cc and up need proof of a licenced driver, registration and inspection. There are five licence grades: A1 for motorcycles 49cc-125cc, A2 for motorcycles over 125cc and vehicles with trailers, B for vehicles transporting less than 10 passengers, hauling goods less than 3.5 tons and/or towing less than .75 tons. B licence holders can also drive the same vehicles as A1 holders but not the same as A2 holders. Nobody can answer, however, how to get a licence that allows you to drive cars and big bikes.

Motorcycles must have rear-view mirrors and drivers must wear a safety helmet.

When a traffic light is yellow it is a sign to prepare to stop or go forward. Driving is prohibited if the driver has from .5mg of alcohol per litre of gas or from .25mg per litre of blood. Hence, the reason to drive a big SUV? Maximum speeds for vehicles in town are 30kph for all motorcycles and tricycles, 40kph for all cars. Outside town the top speed for all vehicles is 90kph. On motorways (national roads), in town the max is 60kph, 100kph out of town.

If you open a car door and cause an accident, you are to blame and all traffic accidents are "under the competency of the traffic police". After an accident, everyone involved must stop and report it to the traffic police.

If there are no injuries, the parties involved can settle or ask for intervention from the police. If there are injuries or deaths you must help get the victims to a nearby hospital, not tamper with evidence and wait until the police arrive. Police officers are authorised to impound your vehicle as well as impose fines or confiscate your licence for petty offences. If you find yourself in such a situation, stay calm and resign yourself to the fact it will take time to resolve. Bringing in copies of the legal code, along with as many people as you can muster, to the police station will help. Cash is, of course, faster.

Saturday, September 5, 2009

China invests $80 mln in Cambodian power sector

PHNOM PENH, Sept 4 - Cambodia has signed an $80 million deal with China National Heavy Machinery Co to build a power transmission network in areas around the capital where factories have mushroomed in the past decade, a power official said on Friday.

Keo Rattanak, director general of Cambodia's Electricite du Cambodge, said the project, which would start next year and take three years to complete, was part of government efforts to address complaints by foreign investors.

The loop line transmission network will bring in electricity from various sources, including hydropower plants built by China in the northwest and southwest provinces, as well as a $160 million, Malaysian-funded coal-fired power plant in the south, he said.

Foreign investors, many of them with factories making garments on the outskirts of Phnom Penh, have complained about the high cost and unreliability of utilities.

In response, the government wants to attract $3 billion of foreign investment to build six hydropower plants and a coal power plant by 2018.

Cambodia currently produces an estimated 300 MW of electricity and aims to meet current demand of about 500 MW with the help of supplies from neighbouring Thailand and Vietnam.

U.S. donates military equipment to Cambodian Armed Forces

PHNOM PENH, Sept. 4 (Xinhua) -- The United States donated military equipment to the Royal Cambodian Armed Forces (RCAF) to help human resources and strengthen Cambodia's capacity, said a press release issued by the U.S. Embassy on Friday.

The U.S. formally transferred nearly twenty forty foot containers of excess military equipment to the Royal Cambodian Armed Forces. The original cost of the material was approximately 6.5 million U.S. dollars and included 16,000 Kevlar helmets, 4,000field packs, 6,000 camouflage uniforms among other items.

The equipment was donated through the Foreign Military Financing (FMF) program. Since 2006, Cambodia has received approximately 4.5 million U.S. dollars worth of military equipment and technical assistance through this program.

The FMF program is also funding the grant of excess military transport equipment and technical assistance to the Ministry of National Defense and the High Command, English language training materials and technical assistance to the RCAF English Language Training Program and Maritime Security and Professional Development training to the Royal Cambodian Navy.

The equipment will be issued to priority units with the RCAF, many of whom are currently receiving training and capacity building assistance from the United States, it added.

The handover ceremony was conducted at the National Defense Ministry on Sept. 3 presided over by Brigadier General Skip Vincent and Lieutenant General Chau Phirun, General Director of Materiel and Techniques of the Ministry of National Defense.