Photo Credit: EPA
TRADE, ECONOMY, AND INVESTMENT
EU and US threaten economic sanctions after Cambodia’s Ruling Party claims victory in elections with no viable opposition
(30 July 2018) The conclusion of the Cambodian elections has seen the European Union (EU) and the US threatening economic sanctions against the country in response to the Cambodian government’s repression against press and political opposition. With an annual growth of seven percent, Cambodia’s growth is one of the highest in ASEAN and if sanctions are imposed, it would affect the country’s tariff-free entry in the west. Cambodia’s garment sector would be affected as Cambodian factories send some US$6.7 billion worth of garments to fashion companies around the globe, with 45 percent of it going to the European Union and 23 percent to the US. The ruling Cambodian People’s Party (CPP) won Cambodia’s sixth national assembly elections amid claims by rights groups that the polls was not free and fair due to the absence of any prominent challenger to Prime Minister, Hun Sen. In 2017, the main opposition party, Cambodia National Rescue Party (CNRP) was dissolved and its leader, Kem Sokha was jailed on treason charges. According to the country’s National Election Commission, more than 82 percent of registered voters came out to vote.
Enterprises foresee brighter prospects in Mekong Delta
(26 July 2018) Business firms in the Mekong Delta are confident with its business outlook for the first half of the year, according to a survey carried out by Vietnam Chamber of Commerce and Industry (VCCI). The results of the study indicate that more than 83 percent of the companies operating in the Mekong Delta had a stable production of output in the first half of the year. Of the 83 percent, 41.9 percent of the enterprises responded by stating that business performance is better than the previous years, with 45.2 percent remaining the same and 12.9 percent worsening. However, most of the businesses agreed the price fluctuation of imported raw materials made it difficult since these firms are reliant on those goods.
Thai trade delegation to Vietnam looks to lift NTB on Thai vehicles
(27 July 2018) Thailand’s Commerce Minister, Sontirat Sontijirawong will attend the third meeting of the Thailand-Vietnam Joint Trade Committee (JTC), takes place from 2 to 3 August 2018. Lifting non-tariff barriers on Thai built vehicles imposed by Vietnam’s government will run high on the agenda, and the ministry also intends to increase bilateral trade value with Vietnam to US$20 billion in 2020. Recently, Thai exporters have suspended car shipments after Vietnam imposed non-tariff barriers on entirely built-up cars from Thailand which was deemed as discriminatory practices towards Thai exporters. Vietnam is Thailand’s second biggest trading partner in the region, and in the last five years, trade between Thailand and Vietnam was about $13.14 billion, with a growth of 9.7 percent every year.
Thilawa Special Economic Zone in Myanmar attracts 89 investors from 17 countries
(30 July 2018) The Thilawa Special Economic Zone, located at the outskirts of Yangon, is the first Special Economic Zone (SEZ) built in Myanmar. The megaproject has attracted 89 investors from 17 countries, with over US$1.374 billion invested in Zone A. The development of Zone B is underway and will be completed in 2018. According to the Thilawa SEZ Management Committee, Japan and Singapore are among the most prominent investors for this project, accounted for over 60 percent of the total investment. Permits have been issued to 86 businesses for Zone-A, and seven for Zone-B.
Plans underway to build the Sixth Lao-Thai Friendship Bridge across Mekong River
(25 July 2018) Arrangements are being made to build the sixth Lao-Thai Friendship Bridge over the Mekong River between the Saravan province in Lao and Ubon Ratchathani province in Thailand. Both countries will begin raising funds once the designing phase is completed. An official from the Ministry of Public Works and Transport Road said the construction phase is expected to start in 2020. Currently, four Lao-Thai bridges are in operation, linking the two neighbouring countries while the fifth bridge that costs US$110 million has yet to commence. The bridge will permit accessibility between the north-eastern region of Thailand to central Vietnam via Laos which will boost trade, investment and tourism sector for both countries.
About Greater Mekong Subregion (GMS)
The Greater Mekong Subregion (GMS) Economic Programme was launched by the Asian Development Bank in 1992 connecting five developing ASEAN countries, namely Cambodia, Laos, Myanmar, Vietnam and Thailand, and Chinese provinces of Yunnan and Guangxi Zhuang Autonomous region. The region has some of the most robust economies sharing the Mekong River Basin thanks to its reform and liberalisation. The subregion is growing at a faster pace than the whole of East Asia and the Asia Pacific as the GDP growth rate for 2017 was at 6.4 percent, according to the World Bank. The population at the subregion as of 2016 is at 340 million while the GDP at PPP is at US$3.1 trillion in 2016. In 2015, trading within the region was at US$444 billion.