The Cambodia-Korea Free Trade Agreement or CKFTA has started boosting the bilateral trade between the two countries two weeks after the pact came into force on December 1, 2022, amid encouragement for South Korean investors to invest in Cambodia’s processing and automobile industries, said a release from the commerce ministry.
The progress made through CKFTA was revealed on Tuesday during the meeting between Pan Sorasak, Minister of Commerce (MoC) and South Korean delegation led by the South Korean Ambassador to Cambodia Park Heung-kyeong before leaving the Kingdom after completing his diplomatic term, said a release on Wednesday.
The release pointed out that CKFTA allowed the bilateral trade between Cambodia and South Korea to achieve $0.5 million during the first two weeks of December 2022. Sorasak appreciated Heung-kyeong for successful completion in Cambodia, especially facilitation in the negotiation for the enacted bilateral free trade agreement.
Heung-kyeong appreciated the implementation of CKFTA and the avoidance of the double taxation agreement between the two countries and expected that these agreements would increase the confidence of South Korean investors to invest more in Cambodia. He also praised Sorasak for his successful chairmanship of the ASEAN Economic Ministers and Related Meetings.
Sorasak told the South Korean Ambassador that the trade volume between Cambodia and South Korea has increased four percent to $659 million in the first 10 months of this year compared to the same period of 2021 after the figure was about $772 million in 2020—a six percent increase from $729 million in 2019.
“The bilateral trade volume between the two countries has remarkably been positive … The commerce ministry has been ready to work closely with a new ambassador to continue bilateral cooperation and collaboration to make new achievements,” said Sorasak, adding that the South Korean government and people have provided Cambodia with financial and technical assistance.
The commerce minister went on to add that the assistance was provided for Cambodia to implement its economic development projects to recover its economy during the post-pandemic period such as the construction of Cambodia-Korea Friendship Bridges that would enable the people to cross the Tonle Sap and Mekong Rivers.
“The new investment law encourages much for processing and automobile industries,” the minister said. Both counterparts reaffirmed the commitment to continue their close cooperation to strengthen, expand and boost the relations between the two countries in the development of the economy, trade and investment.
Heung-kyeong appreciated the relations between Cambodia and South Korea, especially in politics, economy, commerce and human resource exchange. The ambassador also paid his gratitude to Cambodia for supporting South Korea to be a candidate for the Director General of the International Trade Organization in 2021 and applauded Cambodia for its successful chairmanship of the Association of South East Nations (ASEAN) in 2022.
Article 10.10 of CKFTA states that the free trade agreement between the two countries shall be effective 60 days after Cambodia obtained a diplomatic notification from its South Korean counterpart as per their negotiation and consent. Under CKFTA, Cambodia is expected to receive over 95 percent of the total tariff lines from South Korea to export 92 percent of all of its goods to the latter at zero percent of customs duty immediately after the agreement is entered into.
“In addition to that, both parties will form a joint committee and workforces to track and monitor the operations and implementation of this agreement to achieve high effectiveness,” said Seng Thai, spokesman and Secretary of State of the Ministry of Commerce. The notification came after the Embassy of the Republic of Korea issued a notification to the Ministry of Foreign Affairs and International Cooperation (MFAIC) of the Kingdom of Cambodia on October 2, 2022.
Lim Heng, Vice-President of the Cambodia Chamber of Commerce (CCC), told Khmer Times that the private firms applauded the CKFTA as it would be another gateway for them to expand exporting their goods in addition to the current markets and tax preferences such as Everything But Arms (EBA) and Generalised System of Preferences (GSP) offered by the United States will run out of for Cambodia in the near future.
“The more important thing is the implementation and during the implementation, we would see the problems and challenges or requirements and then we will put those on the table to find responses for maximising its profits,” he said. Cambodia would rather be more dependent on such free trade agreements, he added.
Source: Khmer Times
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<p>Time: 2024 By: Ministry of Industry and Trade</p>
