Malaysia upgraded its position from 17th to 14th largest trade partner with Cambodia in the first nine months of 2023. Transaction value for the period reached nearly $487 million, marking a 7% growth compared to the corresponding period in 2022, as reported by the General Department of Customs and Excise (GDCE).
From January to September 2023, Cambodia and Malaysia experienced a bilateral trade volume of $486.59 million. The figure represents a 7% increment from the $454.72 million recorded in the same months of 2022.
Malaysia’s imports into Cambodia rose by 10.1% to $414.54 million, whereas Cambodia’s exports to the Muslim-majority nation declined by 7.8% to $72.04 million. This establishes a trade deficit for Cambodia of around $342.5 million.
In September alone, bilateral trade reached $57.38 million, an increase of 6.45% over September 2022. During the month, Cambodia’s exports amounted to $11.53 million, surging by 33.5%, while imports from Malaysia stood at $45.84 million, rising by 1.9%.
Hong Vanak, an economist at the Institute of International Relations at the Royal Academy of Cambodia (RAC), highlighted on October 25 the significance of Malaysia as an influential ASEAN member.
Possessing a large population, robust economy and numerous enterprises, Malaysia has been a major importer of goods to Cambodia, he said.
He explained that some of these imported goods satisfy domestic needs, while others serve as raw materials for further processing, ultimately leading to exports to global markets. He noted that the country’s primary exports to Malaysia include agricultural and agro-industrial products.
He explained that Cambodia’s trade deficit is not necessarily detrimental and that any imports are essential components for machinery destined for global export. He believes the country should focus on attracting foreign investment and enhancing workforce training.
“In international trade, countries often experience trade balance fluctuations due to varying demands and the need to import resources or semi-finished goods for domestic consumption and export,” he stated.
He also pointed out the increasing number of Cambodians working in Malaysia and the influx of Malaysian investments into Cambodia.
Lim Heng, vice-president of the Cambodia Chamber of Commerce (CCC), previously noted that Malaysia purchases agricultural items from Cambodia, including milled rice, oil palm, rubber and pepper. He said that fabrics and industrial products are also traded.
Cambodia’s primary imports from Malaysia consist of auto parts, food and beverages, pharmaceuticals and select electronics.
Former Prime Minister Hun Sen and his Malaysian counterpart Anwar Ibrahim committed to enhancing bilateral relations earlier this year, in March. They agreed to seek innovative methods to intensify their multifaceted cooperation, spanning politics, security, socio-economy and culture.
For reference, bilateral trade between the two nations reached $620.37 million in 2022, marking a 23.3% rise from 2021. Cambodian exports to Malaysia grew by 10.4% to $111.85 million, while imports from Malaysia rose by 26.6% to $508.52 million, according to the GDCE.