During a meeting between Ms. Marisa Haruta. Chief Representative of Japan External Trade Organisation (JETRO) and Cambodia Investment Review, Ms Haruta spoke of current Japanese investments in Cambodia, we well as future areas for potential growth.
JETRO is a governmental organisation set up to support Japanese companies oversea. Entered the Cambodian market in 2010, upon the request from Samdech Akka Moha Sena Padei Techo Hun Sen, Prime Minister of Kingdom of Cambodia to former Prime Minister of Japan H.E. Mr. Yukio Hatoyama. First founded in 1958, they now have offices in 124 global locations.
As to its role in Cambodia Ms Marisa Haruta told Cambodia Investment Review “Our mission to help facilitate trade between Cambodia and Japan through various means. We arrange a number of exhibitions, events, seminars, etc.. throughout both countries, as well as essentially acting as matchmaking service between companies”.
Overall trade between Cambodia and Japan reached $2.150 billion in the first eleven months of 2021, up 12 percent compared to 2020, with Ms Haruta highlighting the key role JETRO has played in this “The Japanese private sector who seek for a business oversea, knows us well and we estimate almost all private enterprises who do business, or seek for an opportunities, uses our services somehow.
JETRO and changing perceptions of Cambodia in Japan
Another key role for the organization was sharing updated information to Japanese companies about the business situation within Cambodia. Japanese people like many countries has only limited updated news about the country, which can often lead to misconceptions about areas such as stability and business opportunities, with Ms Haruta adding:
“Some people still think of Cambodia in the contexts of 5 to 10 years ago. They will be very surprised when they actually come to Cambodia and see the city by themselves. And they will be surprised again to know government stability and huge economic growth”.
The GDP Annual Growth Rate in Cambodia averaged 7.15 percent from 1994 until 2020, reaching an all time high of 13.25 percent in 2005 before a record low of -3.14 percent in 2020 due to the pandemic. The country has since rebounded to around 4.5 percent in 2021 according to the World Bank.
Despite these numbers Ms Haruta still felt more could be done with regards to education stating “We need to expand information to not just business people, but also to those who have not yet considered or Cambodia as a business destination”.
To share the opportunities in Cambodia, JETRO is now creating around 40 YouTube videos highlighting business opportunities within the Kingdom. And also sharing information through webinars with Ms Haruta stating:
“We recently hosted an online seminar in association with the Council for Development in Cambodia (CDC), and Mizuho bank, about the new investment law. Over 600 people registered, which resulted in 47 companies expressing a plan to enter Cambodia, which we are planning to have an event to invite them all to Cambodia to see the market.
JETRO and the Private Sector / further trends in Cambodia
Over the last 12 years the organisation has seen a number of success stories, particularly with regards to Japanese companies moving their manufacturing to Cambodia. One such example being the Phnom Penh Special Economic Zone (PPSEZ), as previously reported by Cambodia Investment Review.
Now the existing Japanese factories, especially related to car spare parts manufacturers are expanding their business because of both the growing demands. They even speed up the expansion to ensure Business Continuity Plan (BCP).
“Covid-19 has reminded us that world can be unstable, so companies need to diversify the locations to ensure their production can be completed on time. Therefore companies with plants in surrounding countries are starting to look in to a new location like Cambodia to ensure supply lines”.
Speaking of trends, increasing of investors to Cambodia, should lead to increase the trade between Cambodia and the rest of the world. Most of the manufacturer are now are importing their raw material and exporting their semi-final products to the world.
And when it comes to the future trade opportunities between the two nations JETRO remain optimistic, not merely because of the recent increase in bilateral trade, but specifically with regards to bringing Japanese brands into the country.
“People are getting richer, so the expansion in consumer products is also increasing. Japanese products tends to cost more, but local consumers trust our brands and are prepared to pay for them. We have seen this particularly with cosmetics and baby products which were successful in 2021.
There are also a number of products such as cosmetics that are popular in Vietnam and Thailand for example that are yet to hit Cambodian shelves. We are confident they would do well when introduced to the local market”.
Therefore JETRO feel that there are still a lot more than be achieved as the world slowly opens up and learns to deal with Covid-19 with Ms Haruta finally adding “If people can come we can show them that Cambodia is an amazing country. We are confident they will then see what a viable option for investment the country is”.