Cambodia-Vietnam trade expands in 2024, yet processing limitations hurt farmers

Trade between Cambodia and Vietnam has grown significantly, with a 20.6% increase from January to November 2024, reaching $7.08 billion. Despite this growth, Cambodia remains heavily dependent on exporting raw materials while importing higher-value goods, according to local media.

Vietnam is Cambodia’s second-largest export market after the United States, with $3.29 billion in Cambodian exports, mainly cashews, corn, bananas, mangoes, and other products. Meanwhile, Cambodia imports $3.79 billion worth of goods from Vietnam, including food products across various categories.

Cambodian farmers struggle with low selling prices and high costs for fertilizers, fuel, and machinery, making their products less profitable.

Fertilizer dependency is also a concern, with Cambodia importing $207 million from Vietnam, $139 million from Thailand, and smaller amounts from China, Japan, and South Korea. Due to high production costs and outdated techniques, many Cambodian farmers rent out their land to Vietnamese farmers for rice cultivation.

In 2024, Cambodia exported 95% of its raw cashew nuts, keeping only 5% for domestic processing, leading to value loss for farmers and traders. The high cost of electricity and logistics further limits Cambodia’s ability to compete in global markets.

To develop a strong agro-processing industry, Cambodia must reduce electricity costs, modernize food processing, and improve export strategies. Expanding access to funding and technical training would help the country shift from raw exports to higher-value agricultural products.

Without investments in processing and technology, Cambodia risks losing its competitive edge while Vietnam continues to dominate the value-added stage of agricultural trade.

source: eastasiaforum.org

photo: en.khmerpostasia.com