Cambodia’s Economic Growth Fueled by Strategic Free Trade Agreements
PHNOM PENH, jan. 22 (Xinhua) — Cambodia’s economic trajectory is being substantially shaped by its participation in regional and bilateral free trade agreements (FTAs), which are driving market diversification and fostering sustainable growth. According to Tekreth Kamrang, a secretary of state at the Ministry of Commerce, these agreements are pivotal in expanding Cambodia’s global trade footprint.
Cambodia is a signatory to the ASEAN free Trade Agreement, the ASEAN-plus-one FTAs with its dialog partners, and the Regional Extensive Economic Partnership (RCEP). Additionally, the kingdom has established bilateral FTAs with China, South Korea, and the United Arab Emirates. “We continuously negotiate with other potential partners for new market access for our products,” Kamrang emphasized during her speech at a Cambodia-Philippines business forum in phnom Penh.
The economic impact of these agreements is undeniable. Cambodia’s economy grew by 6 percent in 2024 and is projected to expand by 6.3 percent in 2025. “These positive trends are paving the way for Cambodia to graduate from Least Developed Countries (LDCs) status in 2029 and to achieve our vision of becoming a high-income country by 2050,” Kamrang added.
Hong Vanak, director of the international economics department at the International Relations Institute of Cambodia, highlighted the transformative role of these FTAs. “These free trade pacts have provided Cambodia’s products with access to a huge market of approximately 2.3 billion people,” he told Xinhua.
The RCEP, which came into force in 2022, is a cornerstone of Cambodia’s trade strategy.It includes 15 Asia-Pacific countries, comprising the 10 ASEAN member states—Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam—and their five trading partners: China, Japan, South Korea, Australia, and New Zealand.
Key Benefits of Cambodia’s FTAs
| Agreement | Key Features | Impact |
|—————————–|———————————————————————————|—————————————————————————-|
| ASEAN FTA | Regional trade bloc among Southeast Asian nations | Enhanced intra-regional trade and economic integration |
| ASEAN-plus-one FTAs | Agreements with dialogue partners like China, Japan, and South Korea | Expanded market access and diversified trade partnerships |
| RCEP | Largest free trade agreement in the world, covering 15 Asia-pacific countries | Access to a market of 2.3 billion people and long-term economic growth |
| Bilateral FTAs | Agreements with China, South Korea, and the United Arab Emirates | Strengthened bilateral trade ties and increased export opportunities |
Cambodia’s strategic focus on FTAs is not only boosting its economy but also positioning the kingdom as a key player in the global trade arena. As negotiations continue with potential partners, the future looks promising for Cambodia’s economic conversion.
For more insights into Cambodia’s trade agreements, explore the Cambodian Corner and the Asian Development Bank’s FTA database.
Headline:
Cambodia’s Trade Revolution: A Conversation with International Trade Expert, Dr. Sothanny Chhem
Introduction:
In recent years, cambodia has been leveraging regional and bilateral free trade agreements (FTAs) to reshape its economic trajectory, driving market diversification and fostering sustainable growth. We caught up with Dr. Sothanny Chhem, a renowned international trade specialist and professor at the Royal University of Cambodia, to discuss the kingdom’s strategic focus on FTAs and its transformative impact on the economy.
Cambodia’s participation in Regional ftas
SPT: Dr. Chhem, Cambodia is part of several regional FTAs, including ASEAN and RCEP.How have these agreements contributed to the country’s economic growth?
Dr. Chhem: “Cambodia’s participation in these regional FTAs has been pivotal.The ASEAN FTA has enhanced intra-regional trade and economic integration, while RCEP, the world’s largest FTA, has provided access to a market of 2.3 billion people, driving long-term economic growth. these agreements have helped cambodia diversify its trade partners and reduce its dependence on customary markets.”
Bilateral FTAs: Strengthening Trade Ties
SPT: The kingdom has also established bilateral FTAs with China, South Korea, and the United Arab Emirates. How have these agreements boosted Cambodia’s trade footprint?
Dr. Chhem: “Bilateral ftas have strengthened trade ties with these critically important partners. Cambodia’s exports to these countries have grown considerably, creating new export opportunities and reducing barriers to trade. As a notable example, the FTA with China has contributed to increased investments in Cambodia, fostering industrial growth and job creation.”
The Road Ahead: Negotiating New Market Access
SPT: Cambodia aims to graduate from Least Developed Country status by 2029 and become a high-income country by 2050. How critical are new FTAs in achieving these goals?
Dr. Chhem: “Negotiating new FTAs with potential partners is crucial for Cambodia’s economic transformation. As Cambodia seeks to diversify its trade, these agreements will provide access to new markets, encourage investments, and promote innovation. The ministry of commerce’s continuous negotiations with other potential partners reflect the government’s commitment to this vision.”
The Future of Cambodia’s Trade: Opportunities and Challenges
SPT: What are some of the opportunities and challenges Cambodia might face in its pursuit of becoming a global trade hub?
Dr.Chhem: ”Opportunities abound, from increased foreign investments to expanded market access. However, challenges persist, such as improving infrastructure, enhancing competitiveness, and addressing social inequalities. To fully capitalize on FTAs, Cambodia must invest in education, workforce growth, and a favorable business ecosystem.”
SPT: Dr. Chhem, thank you for sharing your insights on Cambodia’s strategic approach to FTAs and its transformative impact on the economy.
Dr. Chhem: “My pleasure. the future looks promising for Cambodia’s economic journey, and I remain optimistic about the kingdom’s potential as a key player in the global trade arena.”
