WASHINGTON: Cambodia’s total exports of garments and footwear to Japan increased sharply in the first half of the year, according to latest figures from the Japan External Trade Organisation (Jetro).
Cambodia’s total exports of garments and footwear to Japan increased sharply in the first half of the year, according to latest figures from the Japan External Trade Organisation (Jetro). Jetro’s figures indicate that from January to June, Cambodia’s exports to Japan rose by 32.7%% to $565 million, from $425 million in the same period last year, the Khmer Times reported on Thursday. Soeng Sophary, spokesperson for the Commerce Ministry, told the Khmer Times there was a surge in exports of garments and footwear to Japan during the period due to the competitive prices of Cambodian products.
“Japan doesn’t manufacture these Cambodian products [garments and footwear] and they are competitive due to lower production costs,” said Ms Sophary. “Also Cambodia has good relations with Japan and this has resulted in more orders from Cambodian suppliers,” she added. While export earnings to Japan from the garment and footwear sector have increased, there are now calls for Cambodia to diversify its manufacturing base.
Hiroshi Suzuki, CEO and chief economist of Business Research Institute for Cambodia, said there was an overreliance on garment exports to rake in the country’s foreign earnings. He recommended a shift from low-priced garment manufacturing to higher ended manufacturing of automobile, machinery and electronic parts. “This shift is necessary for the overall health of the economy,” said Mr Suzuki.
Mr Suzuki said Cambodia could learn from Japan on how to utilise international supply chains for manufacturing. The main products that Cambodia exports to Japan are garments, footwear, sugar, fish and seafood. Meanwhile, Cambodia imports machinery, automobiles, electronic products, beef, iron, steel and pharmaceutical products from Japan. There is a trade imbalance with Japan and according to Jetro’s figures, Cambodia’s imports from Japan only rose marginally by 0.9% to $134 million in the first half of the year, compared to the same period last year.
