The Sihanoukville Special Economic Zone (SSEZ), will be a key driver in bilateral trade between Cambodia and China, reaching $10 billion in 2023, and could prove to be a bellwether in boosting trade activities with other countries in the region and globally, according to Deputy Prime Minister Hor Namhong.
Namhong said that the SSEZ enjoys a special locational advantage because it is close to the deep-sea port of Preah Sihanouk province, which is the engine for exports and imports moving from and into Cambodia. He added that Sihanoukville is one of the pillars of Cambodia’s economy and tourism industry with many Chinese companies already investing there and many more potentially soon to join them.
On Oct 12, China and Cambodia signed a free trade agreement (FTA) in Phnom Penh, with Cambodian Prime Minister Hun Sen and visiting Chinese State Councillor and Foreign Minister Wang Yi attending the ceremony.
The FTA is of great significance economically and politically. Under the Cambodia-China bilateral FTA, Cambodia succeeded in listing close to 340 additional commodities for tariff-free export to China, bringing that total to more than 10,000.
Most of these newly listed products are in the agriculture and agro-processing sectors and are in addition to increases Cambodia attained via the Asean-China FTA, according to the Ministry of Commerce (MoC).
The Cambodia-China FTA will drive more investment to Cambodia from China as well as other countries targeting China for their exports, particularly those in the agro-processing sector, the MoC said.
Cambodia Chamber of Commerce Vice-President Lim Heng said that upon implementation in January, the FTA will give all special economic zones in the country a lift, but the Sihanoukville zone will see an extra boost because the majority of imports and exports to and from China already go through this area.
Heng specifically noted: “The SSEZ will benefit greatly from the FTA next year because the major exports of raw materials including garments and increasingly, agricultural products such as bananas, mangoes and rice are sent to China through Sihanoukville,”