Cambodia: Govt pushes for tariff cuts, urges factories not to panic

The Royal Government has all kinds of measures in place to facilitate and safeguard the interests of the private sector, says Deputy Prime Minister Sun Chanthol.

Sun Chanthol, Deputy Prime Minister and First Vice-Chairman of the Council for the Development of Cambodia (CDC), Thursday urged the factory operators to remain calm, saying that he had sent another official letter to the US government seeking further tariff relief.

Comparing the tariff concern to thunder, which is not always followed by heavy rain, Chanthol said, “Don’t pour the water out of pots just because you heard a loud thunder.”

The assurance was made during the event on ‘Dissemination of Progress Report on the Implementation of Resolute Reform Measures Introduced at the 19th Government-Private Sector Forum – Second Semester 2024’ in Phnom Penh on July 17.

During his remarks, Chanthol said that the Royal Government had submitted an official letter to the US government at midnight on Wednesday regarding ongoing tariff negotiations, expressing hope that further reductions would be secured before the August 1 deadline.

“The document, which was officially sealed, was sent at approximately 11:30 pm on July 16,” Chanthol said, without disclosing specific details of the issues outlined in the letter, unlike the announcement on June 16, where he listed three key negotiation points with the US Trade Representative.

Nevertheless, he expressed optimism for a favourable outcome, especially in light of the country’s efforts to address trade concerns. He urged investors, particularly factory operators, not to panic and to remain confident in the government’s handling of the matter.

“Please be informed that we [the Royal Government] have acted comprehensively to protect our national interests. To all investors operating factories, please remain calm and do not panic,” Chanthol said.

He went on: “Don’t pour the water out of pots just because you heard a loud thunder,” an old Cambodian proverb about the traditional way of preserving water, symbolising the importance of patience and trust in difficult moments.

“Please stay calm and believe in the Royal Government. We have all kinds of measures in place to facilitate and support the private sector,” he added.

Hem Vanndy, Minister of Industry, Science, Technology & Innovation (MISTI), Kith Meng, President of the Cambodia Chamber of Commerce (CCC), and Derek Yip, Australian Ambassador to Cambodia, were present among key dignitaries and private sector representatives.

Speaking to Khmer Times, Lor Vichet, Vice-President of the Cambodia-Chinese Commerce Association (CCCA), said the Royal Government is committed to enhancing cooperation with the US side to reduce tariff rates to below 36 percent in a spirit of mutual understanding and mutual interest.

“The Deputy Prime Minister has shown optimism in addressing US concerns and in meeting their requests, which is crucial for improving the environment for meaningful tariff negotiations,” he said.

Vichet emphasised that to reach a concrete outcome, the government must directly address the US’s priority concerns, as the final negotiated tariff rate could form the foundation of long-term Cambodia-US bilateral trade and investment.

He explained, “If Cambodia can import $1 billion worth of goods from the US in exchange for the US importing $15–$20 billion worth of Cambodian products, then we are successful in our negotiations and are laying a strong groundwork for a future bilateral trade and investment framework based on common interests.

The CCCA Vice-President also underlined that as the Royal Government intensifies its crackdown on cybercrime and transnational crime to improve the current investment climate, Cambodia should consider importing high-tech equipment and tools from the US to improve its crackdown operations and effectiveness.

“The move aligns with American policy interests and also supports Cambodia’s efforts to make the Kingdom a safe place to invest and reduce the trade deficit, fostering stronger economic ties and mutual benefits between both countries,” he added.

Source: Khmer Times