The two countries have struggled to boost bilateral trade volumes and fell far short of their announced plan pursuant to the Cambodia-Laos-Vietnam Development Triangle to achieve US$5 billion in bilateral trade by 2015.
In 2014, trade between the two countries reached US$3.3 billion, only to fall to US$3 billion and US$2.8 billion in 2015 and 2016, respectively.
However, Tran Manh Tiep, second secretary of the Vietnam Embassy in Cambodia, has unveiled that the Vietnamese government has launched a trade-development plan that aims to build warehouses at strategic border crossings to promote regional trade.
In total, the plans call for 116 warehouses to be built as storage for imports and exports along the borders of Vietnam with Cambodian and Lao with a tentative completion date of 2035.
This will help to boost bilateral trade between Cambodia and Vietnam by having more trade activity along border, said Tiep. The initiative will make it easier to store and transport goods.
While he acknowledged that a few of the warehouses would be constructed in the near future, Tiep declined to disclose the overall budget for the plan or a detailed timeline for implementing it.
Nevertheless, its clear the warehouses will serve as vital points for the carrying out of customs procedures and inspections for compliance with food safety and quality standards.
Kim Savuth, president of Cambodian rice exporter Khmer Food Company, said the warehouse plan of Vietnam would benefit farmers, but could prevent agriculture in Cambodia from scaling up beyond raw material exports.
As a rule, Vietnamese businesses do not buy finished products from Cambodian farmers, said Savuth, noting they generally only buy raw products such as paddy rice and other commodities.
However, Hak Sovanna, president of the Cambodia Kampot-Takeo-Kep Chamber of Commerce, believes the warehouses would benefit the economies of both countries and tighten trade ties.
Sovanna added that the construction of warehouses by Vietnam will expand their ability for much larger bulk purchases than they historically have been making.
Sovanna noted that the plan for the warehouses is strong evidence that Cambodian agricultural crops woud continue to be in high demand by Vietnamese consumers. It might also signal Cambodian crops would someday be able to command a higher sales price than they do currently.
Meanwhile in other good economic news related to trade and investment between Vietnam and Cambodia, the Vietnam Rubber Group has announced it has now invested in 23 rubber plantation projects in Laos and Cambodia.
In addition, it has constructed two latex processing plants in Ratanakiri and Kampong Thom provinces in Cambodia that have a capacity to produce 8,000 tons annually.
Lastly, Vietnamese company Hoang Anh Gia Lai has unveiled it has now planted 31,229 combined hectares of rubber trees in Laos and Cambodia.
