Logo of Phnom Penh Post newspaper Phnom Penh Post - Hun Sen calls for caution amid China-US trade war

Hun Sen calls for caution amid China-US trade war

A worker cuts a sample from a steel coil that was set aside for quality-control testing during steel production at the NLMK Indiana steel mill on March 15 in Portage, Indiana. SCOTT OLSON/GETTY IMAGES NORTH AMERICA/aFP
A worker cuts a sample from a steel coil that was set aside for quality-control testing during steel production at the NLMK Indiana steel mill on March 15 in Portage, Indiana. SCOTT OLSON/GETTY IMAGES NORTH AMERICA/aFP

Hun Sen calls for caution amid China-US trade war

Prime Minister Hun Sen warned on Tuesday that a developing trade war between the US and China could affect Cambodia, and said the Kingdom must act to mitigate any potential fallout.

In March, US President Donald Trump’s administration slapped tariffs on global imports of steel and aluminium, with the president later threatening to do so on up to $60 billion of Chinese goods. China responded by unveiling plans to impose tariffs on $3 billion of American imports.

“We must monitor this issue,” Hun Sen said, warning that other countries might feel the ripple effects.

“We do not export steel and aluminium, but please don’t forget that global economic issues influence all places. We must prepare ourselves to avoid crisis in the trade sector and reduce any impacts.”

Miguel Chanco, lead Asean analyst for the Economist Intelligence Unit, said the risks to Cambodia’s economy are evident from past experience with Vietnam.

Chanco said that the US imposed high duties on Vietnamese steel in December 2017, because they determined it had too much Chinese material in it. The US believed China was “basically exporting Chinese steel through Vietnam”, he explained.
The same duties could potentially be applied to Cambodia’s garment industry if it’s found to rely predominantly on Chinese material, which Chanco believes it does.

He believed Hun Sen’s strategy for reducing risk was likely to continue lowering dependence on the US while strengthening ties to China. So far, he said, the shift has served Cambodia well, with the economy “more diversified than it was five years ago”, though he warned it could go too far.

Chan Sophal, director of the Centre for Policy Studies, said an economic slowdown brought on by a trade war could reduce Chinese investment in Cambodia. He did note, however, a trade war might aid Cambodia’s economy in other ways by encouraging China to lower the price of its exports.

“For instance, if the export of Chinese steel and aluminium to the US declines because of the high tariffs . . . China might lower the price for exporting to Asia. We can purchase the Chinese steel cheaper than before.”

Additional reporting by Andrew Nachemson

MOST VIEWED

  • Prince injured, wife dies after accident

    THE wife of former First Prime Minister Prince Norodom Ranariddh, Ouk Phalla, 39, died while the prince was “severely” injured following a road accident in Preah Sihanouk province’s Prey Nub district on Sunday morning, officials said. Rananriddh, who is also the president of the Funcinpec

  • Guards protest dismissals, reject claims of sharing naked photos of child

    Some 20 former security guards at the US Embassy in Phnom Penh protested on Tuesday against their dismissal. They accused their employers of falsely claiming they had viewed and shared child pornography from their mobile phones as grounds for their termination. In total, 32 personnel were dismissed

  • We’re going to Wisney World!

    More than 6,000 mostly Chinese attendees witnessed the inauguration ceremony of a $1 billion Sihanoukville resort project called Wisney World in the capital on Wednesday. The event on Koh Pich, attended by several senior Cambodian government officials, is a joint venture between China’s AMC International and

  • Funcinpec urges probe into deadly Preah Sihanouk accident

    THE Funcinpec party has urged the government, especially the Ministry of Interior, to investigate the traffic accident in Preah Sihanouk province which left Prince Norodom Ranariddh badly injured and his wife Ouk Phalla dead. Funcinpec Vice President You Hokry told reporters at Botum Votey pagoda,