Friday, March 5, 2010

Keynote Address at the Inauguration of the New Office Building of the Ministry of Commerce

Phnom Penh, February 4, 2010

Your Venerable Samdech Preah Sang Moha Somethea Tephatei NON NGET, Chief of Monks, and Your Venerable Monks,

Excellencies, ladies and gentlemen distinguished national and international guests!

It is my pleasure to be here to inaugurate the New Office Building of the Ministry of Commerce. On behalf of the Royal Government of Cambodia, I would like to commend the management and officials serving under the Ministry of Commerce for their hard work and close collaboration with related ministries/institutions toward completing the construction of this new office.

According to H.E. Cham Prasidh, the construction of this new office building is financed by the privatization of the former office of the Ministry and Toyota garage, and the private sector is obliged to build the new office and equip the new building with minimal office equipments. This achievement indeed stem from the effort of the Ministry in broadening workplace and modernizing equipments to boost efficiency and productivity. Taking this opportunity, I would also like to commend the Ministry for the mental and physical effort to develop trade sector and maximize both domestic and overseas trade potentials.

All these achievements attest to the Ministry’s firm determination to take part in the Royal Government’s policy implementation and the Rectangular Strategy – Phase II to underpin growth, employment, equity and efficiency. In this sense, I urge the Ministry of Commerce to capitalize on the newly built office equipped with modern facilities and equipments to intensify its operation.

I would like to raise some background as a basis for evaluating the development of the Ministry of Commerce. Under the leadership of Kampuchea’s People Revolutionary Party of the People’s Republic of Cambodia, the Ministry was reestablished in 1979 as the Ministry of Economy and Welfare led by H.E. Mok Sakun. The successors include H.E. Ruos Sakmay, H.E. Tang Sarim, H.E. Chan Phin, H.E. Ho Naun, H.E. Nhim Vanda, H.E. Va Huot, and presently H.E. Cham Prasidh.

The Ministry was indeed reestablished after the Great Victory Day on 7 January 1979 whose 31st anniversary has been celebrated recently. After the reestablishment of the Ministry of Economy and Welfare, both the management and officials worked very hard to restore trade sector. Their contribution and sacrifice will be always remembered since the national reconstruction at that time started from scratch, a country with almost anything destroyed, i.e. no market transaction, no currency and deserted cities to achieve what we have today. The Ministry has operated both during war and peace, especially during trade embargo. During the People’s Republic of Cambodia and State of Cambodia, the management and officials of the Ministry firmly fulfilled their duties in promoting trade and protecting the nation by preventing the return of Khmer Rouge. Sadly, some of them were killed, injured or disabled in duty. Also, all levels of the Ministry’s officials have been instrumental in steering people clear of hunger and supplying food and utilities to armed forces and people across the nation to improve their livelihoods.

Even though in the stage of economic reform, which was the most dangerous circumstance, this Ministry has fulfilled its role to bring about continuous success to the economic reform today. Cambodia has been integrating herself into the regional grouping and global community in the name as a nation state that can stand on its own equally with equal right with all countries in the world, in which Cambodia became a member of the ASEAN and WTO. As a result, we have achieved a great deal of works, which include: protecting and maintaining stability in garment industry, that is now pursuing its progress, making a number of rules and regulations to ensure consistency with the World Trade Organization, preparing documents in the commitment table toward open market, trade and services by promoting the joint tax reduction program for the ASEAN Free Trade Area, eliminating the non-tariff barrier, strengthening the quality of goods and services conforming to the technical standard and phytosanitary measures, requesting for Generalized System for Preferences (GSP) on many products for Cambodian export to the foreign markets with zero tariff rate or lowest tariff rate, in which many countries have provided Cambodia with a status as Most Favored Nation (MFN) such as the United States, China, Japan, Korea and other countries in the Association of Southeast Asia, the successful negotiation to open market with WTO member states, especially with a number of giant countries such as the U.S, EU, China, Canada, Australia…etc. through the request to eliminate the custom tariff and withdraw the non-tariff measures. At the same time, we have maintained price stability for significant products, especially food products and have accelerated the international trade for Cambodia since 2003 with the amount of USD 3, 000 million until the end of 2009, the international trade of Cambodia was more than USD 10, 000 million.

Through this, we are able to estimate that Cambodian trade has been moving quickly, yet the global financial and economic crisis has impacted Cambodian trade, which was declining at the end of 2008 and 2009. The Royal Government has always paid high attention to strengthen this trade sector in short-, medium-, or long-term through ensuring the steady peace, political stability, social order; and building various physical infrastructures, improving legal frameworks and enhancing the institutional capacity, developing human resources; and continuing the policy of trade diversification…etc. In this regard, we have constantly cooperated with the private sector and development partners in order to upgrade the trade sector in the face of global financial and economic crisis, in which the committee for the management of private sector development have always discussed with private sector as well as related development partners to observe the evolving process of the Cambodian economy and trade and request for the practical measures to deal with the challenges we are facing.

According to the overall situation, the global financial and economic crisis has been on a passage to return back to normalcy in 2010 and this situation might be better in the upcoming 2011. As for Cambodia, we have seen that the export in 2009 generally increased, especially the export of farming products at the beginning of this year increased remarkably.

Along with the achievements we have made so far and the objective to enhance the Cambodian trade, I would like to take this opportunity to deliver a number of recommendations to the management and officials of the Ministry of Commerce in order to make this sector achieve success and truly and tremendously contribute to the poverty reduction of the people as follows:

1. Must strengthen and expand export base that will enable Cambodia to attract more foreign investors as well as continuing to effectively implement GSP that Cambodia has received. Along with that, we must try our utmost to boost and promote the local production through the implementation of the support program for small and medium enterprises (SMEs) on food processing, handicrafts, fisheries, tourism and textile industry in order to gain comparative advantage of Cambodia, which is required to: (1) continue controlling quality and managing safety of goods that are being trafficked in the domestic market in order to ensure safety to the users (2) promote the value added initiatives, especially on the agricultural products (3) strengthen and develop the quality standard for Cambodian products in order to ensure consistency and the instruction on safety and sanitation (4) increase opportunity for Cambodia products through the creation of exhibition program inside and outside the country, and must implement strictly the labor condition and the protection of the workers’ rights that are the core and most important factors to compete for garment purchasing order from oversea.

2. Keep actively rehabilitating and developing national infrastructure in term of software and hardware through strengthening legal framework and regulations, building institutional capacity to facilitate business, trade and investments activities, for that we have to improve and expand bilateral trade cooperation which could expand market access with tax preferential system.

3. Strengthen implementation of intellectual property right; cracking down production and distribution of fake products, no-quality and spoiled products. In the connection, we have to establish intellectual property right information center to inform customers about intellectual property rights and registered labels as well as to promote effective dispute resolution concerning with fake label fraud.

At the same time, we have to pay great attention to strictly and effectively eliminating and cracking down problems relating to food, vegetables, fruits and beverage fraudulence such as the alteration of quality, expiration date and adding chemical substances for longer preservation, which could harm consumers’ health for the present and in the future.

4. Ensure the price stability of necessary commodity, by successfully implementing trade sector-wide approach, reducing overlapping duties and bureaucracy in trade facilitation through risk management and trade integration strategy, cutting down commission fee and making effort to develop competition law which is a new mechanism to monitor enterprises’ colluding activities to make price high.

5. Keep carrying out deeply regional and global integration program by implementing firmly and strongly required conditions and obligations inscribed in multilateral agreements such as China-Asean Commodity Trade Agreement that Cambodia and China have agreed to start implementation since 1st October 2009, China-Asean Service Trade Agreement, Japan-Asean Comprehensive Economic Partnership Agreement, Korea-Asean Framework Agreement on Comprehensive Economic Cooperation , Korea-Asean Commodity Trade Agreement, Korea-Asean Service Trade Agreement, Asean Free Trade Area for Common Effective Preferential Tariff ( CEPT) Scheme which came into effect and start being implemented from 1st January 2010. Indeed the implementation of these agreements will bring us many benefits such as boosting export-import activities in the region with low tariff, without trade barriers and with fair competition…etc…

In the spirit of what already mentioned, I firmly hope that all relevant ministries/institutions and agencies, private sector and development partners and all the people will actively participate in the implementation of economic integration policy in both regional and global framework in order to reap maximum benefits and bring about prosperity for Cambodia’s socio-economy. Through this, I would like to appeal to all ministries/institutions, authorities concerned, donors, civil society and national and international NGOs and all people to actively support and help develop the trade sector with high responsibility by their respective roles and duties to maintain and ensure a more favorable environment for investment and business in Cambodia.

Before ending, with this newly built and highly equipped office building, I would like to remind the management and officials of the Ministry of Commerce to make further effort with increase responsibility and be determined in fulfilling the mission to promote Cambodia’s trade sector. Also, we must cut back on unnecessary spending with high sense of responsibility and sacrifices for the national interest.

At the end, along with this Official Inauguration of the New Office Building of the Ministry of Commerce, I would like to wish the Supreme Patriarch Non Nget, Chief of Monks of the Royal Kingdom of Cambodia and Your Venerable Monks, Excellencies and gentlemen, national and international guests the four gems of Buddhist blessings: “Longevity, Nobility, Health and Strength”.

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