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Hanoi and Phnom Penh Forge Closer Economic Ties

In a bit of business news from southeast Asia, government and business leaders from Kampuchea (Cambodia) and Vietnam agreed on Monday to improve bilateral trade between their two countries in an effort to promote cross-border business and general cooperation. It has been suggested that trade between Phnom Penh and Hanoi would reach $900 million in 2006. Both governments have agreed to establish seven special economic zones along their common border, and will set up twenty or so border crossings in an effort to facilitate trade.

Vietnam`s deputy minister of trade expressed optimism last week that trade between the two countries would by 2007 exceed the $1 billion mark. However, Kith Meng, who president of the Phnom Penh Chamber of Commerce cited the huge trade gap between the two countries. Meng said Kampuchean exports to Vietnam totaled $46 million in 2005, but paid for what is estimated at $180 million in imports from Hanoi during the same period.

Still, Vietnam recently allowed Kampuchea duty-free access to forty types of agricultural products, and Meng expressed hope that the trade imbalance between Vietnam and Kampuchea would be corrected as soon as possible. Vietnam and Kampuchea have seen their ties improve since the years of the Vietnam war, and Hanoi and Washington have set about on what many point out is a successful effort at rapprochement in recent years, with US Navy ships making port calls at Vietnamese cities.