The Ministry of Commerce said that the Cambodia-Korea Free Trade Agreement (CKFTA) will enter into force in early December. The agreement is intended to boost trade volume and expand investment between Cambodia and Korea.
Addressing a workshop on the impact of the CKFTA on exports, Minister of Commerce Pan Sorasak said that the workshop aimed to raise awareness about export procedures so that the private sector can boost exports and maximise the benefits of implementing the CKFTA, especially through the use of CKFTA certification of origin
He added that the agreement will complement the existing ASEAN-Korea Free Trade Agreement and the Regional Comprehensive Economic Partnership (RCEP) agreement. Under the CKFTA agreement, Cambodia has also opened the market with 89.09 per cent of tariffs eliminated, while the Korean side has opened the market with 95.03 per cent of tariffs eliminated and Cambodia will be able to export goods at zero tariff rates immediately after the entry into force of 92.37 per cent of tariffs removed.
The minister was optimistic that once the CKFTA entered into force in the near future it would help boost trade volumes between the two countries and create more export opportunities.
In a report, the Ministry of Commerce said that in the first nine months of 2022, the trade volume between Cambodia and South Korea was worth more than $600 million. The volume had increased by three per cent when compared to the same period in 2021.
The report said that Cambodia had exported $175 million worth of goods to South Korea, up 21 per cent, and imported goods worth $426 million from South Korea, down three per cent.
At bilateral meetings on the sidelines of the ASEAN Summit in Cambodia, South Korean President Yoon Suk Yeol hailed the economic cooperation and the increase in trade between the two countries.
He said that the CKFTA would give a further boost to trade volume, especially boosting investment by South Korea in Cambodia.
At the meeting, Prime Minister Hun Sen noted the increase in investments by South Korea, which ranked second among Cambodia’s major investment partners.
Hun Sen asked that Yoon encourage more Korean investors to invest in Cambodia after the CKFTA takes full effect.
Hun Sen initiated the idea of entering into a CKFTA during a state visit that former South Korean President Moon Jae-in paid in March 2019 to Cambodia.
The CKFTA was signed formally on October 21, 2021 and the agreement becomes effective on December 1, 2022.
Under the agreement, the Cambodian government expects that exports and imports between the two countries would increase and would aid in the economic recovery after the Covid-19 pandemic and help offset the inflation and other economic issues caused by the Russian war against Ukraine.