International pharmaceutical companies are increasingly looking to sell their products to Cambodia, although the market is full of obstacles, according to experts.
After several big international players announced sales expansion plans, two companies from Indonesia, a major manufacturing hub in Southeast Asia, are planning to follow.
Kalbe Farma, Indonesia’s largest listed pharmaceutical... continue
AEON Microfinance (Cambodia) Co Ltd says it has expanded its installment payment services into the agricultural sector, a new business type industry insiders say could be successful, but will still not be enough to strengthen one of Cambodia’s most crucial economic sectors.
“We will co-operate with agricultural equipment shops and provide the instalment [sic] for appliances such as cultivators, which cost about $2,000. We pay to the shop, and the customer pays to us monthly,” managing director Daisuke Maeda told the Post. …
Part of Japan’s AEON Group, the microfinance institution (MFI) started offering an instalment service, or hire purchase (HP), in December 2011 for electrical appliances and motorbikes, which is different from loans directly given in cash to the customer.
Compared to other players in Cambodia’s crowded MFI market, AEON will charge a relatively high interest rate of about 3.3 per cent per month but does not take any collateral. …
Cambodian imports of packaged monosodium glutamate (MSG) totalled just 2,086 tonnes last year, the lowest amount since 2002, according to import figures from the customs department of the Ministry of Economy and Finance.
The import figures showed that from 2002 to 2010, Cambodia had imported a total of 137,908 tonnes of MSG, an average of about 15,323 tonnes annually.
While domestic MSG consumption is said to be on the rise, industry insiders say the decline of imports is not because Cambodians are turning away from the popular taste enhancer, but because a local packaging factory is feeding domestic demand. …
For the second time in five days, Cambodia’s garment industry has been rocked by another partial collapse of a structure at a factory.
Garment workers are reporting that at least 10 people, including a pregnant woman, have been injured after a concrete platform collapsed into a pond at the back of the Top World Garment (Cambodia) Ltd. factory on the outskirts of Phnom Penh at about midday today. …
Vietnam’s investment in Cambodia has increased significantly in the last three years, but a mechanism to encourage and oversee investments in prioritized sectors is needed, according to diplomatic sources.
Tan Nguyen Tien, head of the economic section at the Vietnamese embassy in Phnom Penh, said Vietnam’s investments in Cambodia quadrupled from $566 million in 41 projects in 2010 to $2.5 billion last year. …
Tien said Vietnam Airlines’ direct services between the two countries and Viettel’s telecom service in Cambodia have helped boost Vietnamese investment in that country. …
There are also four projects in the energy sector with a total investment of nearly $800 million, five in finance-banking with $250 million, one telecom project capitalized at $150 million, and a civil aviation project worth $100 million.
Vietnamese FDI in Cambodia is expected to top $4 billion by 2015, and trade between the countries to increase from $3 billion last year to $5 billion by 2015. …
Thailand-based Ratchaburi Electricity Generating Holding Pcl (RATCH) has “seriously assessed” investment possibility in neighbouring countries including Cambodia, a company statement said last Thursday.
It said it had geared up for business expansion in domestic and international markets in the potential existing investment bases Laos and Australia, but is also considering Cambodia, Myanmar and the Philippines. …
AEON Microfinance (Cambodia) Co, part of Japan-based AEON Group, said sales by instalment for electrical appliances and motorbikes increased by 715 per cent in the first quarter of 2013 year on year, a trend industry experts say will grow further with increasing demand for electronics.
Started in December 2011, loan disbursement reached $2.5 million with 5,000 new customers in the first quarter of this year, compared to $343,000 in the same period of 2012, managing director Daisuke Maeda told the Post yesterday.
“Smartphones and PCs are the most popular, followed by motorbikes,” he said. …
The total loan portfolio of AEON Microfinance (Cambodia) at the end of the first quarter this year was about $4 million, with 6,500 customers, Daisuke Maeda said. …
The Ratanakkiri Provincial Court yesterday charged two staffers of Vietnamese rubber concessionaire Hoang Anh Ratanakkiri (CRD) with causing intentional damage for allegedly setting fire to several homes belonging to a landowner with whom they were embroiled in a land dispute, deputy prosecutor Mom Vanda said. …
Ly Sok Ngim, owner of the plantation where the buildings were set ablaze, said she had filed a complaint with police seeking $200,000 in damages from Hoang Anh Ratanakkiri, which she said was the parent company of CRD. …
Bilateral trade volume between Cambodia and Japan had amounted to 180 million U.S. dollars in the first three months of this year, up 14 percent compared with the 158 million U.S. dollars at the same period last year, a report of the Japan External Trade Organization (Jetro) showed Tuesday. …
During the January-March period this year, Cambodia’s exports to Japan was worth about 128 million U.S. dollars, up 24 percent from 103 million U.S. dollars at the same period last year, while Japan’s exports to Cambodia valued at 52 million U.S. dollars, down 5 percent from 55 million U.S. dollars, the report said. …
Japan is one of the largest aid providers to Cambodia, but trade and investment ties between the two nations remain low. …
On the investment side, Japanese investors had invested about 300 million U.S. dollars in Cambodia in the last 3 years, according to a record released by Japanese Embassy to Cambodia in January.
On May 13, we ran an interview with London-based NGO Global Witness accusing the Deutsche Bank and the International Finance Corporation of financing two Vietnamese rubber companies that are allegedly involved in land grabs in Cambodia and Laos. …
We asked both banks for a response and invited them on to the show to explain their positions. Both declined to be interviewed but sent these statements:
Michael West, Managing Director / Head of Communications, Asia Pacific [Deutsche Bank]:
“Deutsche Bank does not provide financing to Hoang Anh Gia Lai Group (HAGL), Dong Phu Rubber or Vietnam Rubber Group (VRG). The DWS fund shares referred to are held on behalf of investors. Deutsche Bank provides clerical trustee services to HAGL which is a listed company as it does to thousands of publicly listed companies globally.”
Hannfried von Hindenburg, Head of Communications for IFC in East Asia and the Pacific:
“IFC, a member of the World Bank Group, works with financial intermediaries, such as funds, because they can contribute to inclusive and sustainable financial markets that are essential to eradicating poverty and job creation. …
IFC will carefully study the findings of the Global Witness research and taking this research into consideration is part of our ongoing monitoring of our investments in Dragon Capital and VEIL.”
A Vietnamese rubber tycoon has rejected accusations by Global Witness, a group that campaigns on resource issues, that it was involved in a land grabbing crisis in Southeast Asia.
Doan Nguyen Duc, the chairman of Hoang Anh Gia Lai (HAGL) Group, told Vietnamese media the information provided by London-based Global Witness in its report was total fabrication. …
According to the report, the two firms have caused widespread evictions, illegal logging and food insecurity in the countries. …
It alleges the IFC invested US$14.95 million in a Vietnamese fund that holds 5 percent equity in HAGL, while Deutsche Bank owns some $4.5-million-worth of HAGL shares. Deutsche Bank is also said to have 1.2-million shares in a subsidiary company of VRG amounting to more than $3 million.
As news of the accusation spread in Vietnam, HAGL shares fall around 6 percent to VND21,400 on Tuesday.
Duc lost VND436.25 billion (US$20.83 million) on over 311 million shares, nearly half the company’s shares, he holds.
After the accusations were made public, HAGL released a statement confirming that the company’s subsidiaries invested in rubber plantations in each country but the firm “denies seizing land, illegally exploiting wood and other corruption behaviors in Laos and Cambodia.” …
In the wake of a new report from environmental rights group Global Witness rebuking the World Bank’s International Finance Corporation (IFC) and Deutsche Bank for investing in rubber plantations accused of illegal logging and forced evictions, both institutions have denied responsibility and deflected the blame elsewhere.
But the investments targeted in the new report are not the first projects for which both the IFC and Deutsche Bank have received criticism in Cambodia.
Local NGOs filed a complaint with the IFC’s compliance ombudsman in 2009 on behalf of 79 families worried that the expansion of Sihanoukville airport was moving forward without their consultation or guarantees of compensation should they be evicted.
Since 2003, the IFC has helped finance Cambodia Airports, which is owned by French construction giant Vinci Group, for projects involving runway expansions at Phnom Penh and Sihanoukville airports.
In July, 387 families living along the outskirts of the Phnom Penh International Airport were served with eviction letters due to expansion plans to the runway. The families insist they have legal tenure to their homes, but the government disagrees and has refused their demands for compensation.
Though the evictions have yet to take place, families have been told by local authorities that the eviction will take place. It was not known yesterday if the ombudsman is monitoring the Phnom Penh airport expansion plan. …
According to Equitable Cambodia, a land rights NGO, Deutsche Bank through DWS [Vietnam Fund] was also invested in KSL—a Thai firm that owns two sugar plantations in Cambodia, which are accused of causing the eviction of hundreds of local villagers. DWS divested from KSL in 2011. …
Chief Cambodia Holding, a Hong Kong-based brokerage firm, started its operations in Phnom Penh yesterday. The company aims to strengthen Cambodian agricultural products, a company official said.
The company reserved $100 million investment capital to connect domestic agricultural producers to the market, Director of Chief Cambodia Holding Te Tea Sieng said. …
Agricultural experts say there are several obstacles hindering growth in the agricultural sector: limited budgets, lack of knowledge about how to improve yields’ quality, and how to access markets. …
Energy Minister Pongsak Ruktapongpisal has given the Electricity Generating Authority of Thailand (Egat) the green light to proceed with a plan to build coal-powered plants in Myanmar and Cambodia – providing Thailand with 10,000 megawatts of electricity. Egat has also been instructed to negotiate the purchase of nuclear power from China in order to bring down the cost of electricity. …
In addition, the Energy Ministry has also been discussing the possibility of investing in a coal-powered plant in Cambodia to produce 4,000MW of electricity. Thailand hopes that buying power from Cambodia will keep the domestic cost of electricity from exceeding Bt6 per unit. Egat also plans to go ahead with its coal-powered project in Krabi once it has reached an “understanding” with residents and businesses protesting against the deal. …
In addition to investing in coal-operated power plants from neighbouring countries, Egat is also looking at investing in hydro-electric power projects within the region. …
The first three-day Koh Kong Investment and Trade Fair 2013 kicked off on Saturday, promoting trade and investment in the southern provinces of Cambodia with neighbours Thailand and Vietnam. …
“The [fair] is aimed at promoting trade and development in Koh Kong province and other border provinces in the southern region of the country, which is to further enlarge trade and the economy between Cambodian provinces, and with the provinces of Thailand and Vietnam that are boardering Cambodia in this southern region,” said Cham Prasidh, Cambodia’s Minister of Commerce. …
The steady growth of franchises from overseas is likely to continue as young, moneyed Cambodians seize the opportunity to bring name brands into the country, a bank official said yesterday. …
Hoping to help its customers and others invest in franchises, Malaysia-based CIMB Bank yesterday organized a talk on franchising at the Malaysian Embassy in Phnom Penh. …
Thida Heng, CIMB head of retail financial services, said franchises were a reliable investment for young Cambodians looking to get into business and move away from property investments following the 2008 property crisis. …
Food and drink franchises are gradually setting up in Cambodia, taking advantage of the market provided by an increasingly wealthy urban population. …
Cambodian Confederation of Unions president Rong Chhun yesterday appealed to landlords with properties close to garment factories not to take advantage of the industry’s minimum wage increase by raising rent prices.
The minimum monthly salary in the garment sector – Cambodia’s biggest export industry – officially climbed from $61 to $75 this month, and Chhun said rent prices were already showing signs of following suit. …
Some workers had been told their rent will increase by 15 per cent at the end of this month, Chhun said. …
Moeun Tola, head of the labour program at the Community Legal Education Center, said he had heard similar stories from garment workers in Phnom Penh, Kandal and Kampong Speu. …
Japanese Bank of Tokyo-Mitsubishi UFJ (BTMU) signed an agreement yesterday with local Canadia Bank to shore up Japanese growth in Cambodia and to demonstrate its confidence in the Kingdom’s financial sector.
BTMU’s managing executive officer, Takami Onodera, and Pung Kheav Se, chairman of Canadia Bank, yesterday signed the agreement with the intention of bringing more Japanese investors to Cambodia. …
Japanese investment totalled about $330 million last year, a big jump from about $75 million in 2011.
Furthermore, data from the Japanese Business Association of Cambodia show that there were 101 Japanese companies here at the end of 2012, an increase from 69 the year before. …
Delta Electronics (Thailand), one of the world’s leading producers of power supplies and electronic components, plans to expand to Cambodia and Myanmar, the Bangkok Post reported on Wednesday.
“There is no indication of a specific timeframe for the expansion, but the company sees these countries . . . as distributing channels of supply chain to other Asian and European countries,” the report said.
Asian Development Bank deputy country director Peter Brimble said, while he cannot speak for Delta about their reasons for moving to Cambodia, generally “regional automotive and electronics firms are looking to expand and spread their operational risk, including firms based in Thailand.” …
Cambodian Prime Minister Hun Sen will visit Macau in September to participate in the Second Global Tourism Economy Forum. Prime Minister Hun Sen called for more investment in the country by Chinese and Macau entrepreneurs, and direct flights between Cambodia and Macau.
According to Xinhua, the Prime Minister met with Edmund Ho Monday in the Cambodian capital Phnom Penh, to discuss further expansion of bilateral ties in economics, trade and tourism. Ho is the former Macau Chief Executive and also a vice-chairman of the National Committee of the Chinese People’s Political Consultative Conference,
Speaking at the meeting at the Peace Palace, Edmund Ho, who is also chairman of the Global Tourism Economy Forum, said his visit to Cambodia was to further promote China-Cambodia relations and cooperation, particularly between Cambodia and Macau …
[Deputy Prime Minister and Minister of Finance] Keat Chhon noted that from 1992 to present, China has provided USD2.7 billion in soft loans and grants to Cambodia for rehabilitating and building infrastructure. Keat Chhon and Edmund Ho also discussed ways to promote tourism.
