No.30 (Apr 02, 2021)

Market Industry Trend

$200M credit guarantee scheme launched. The Ministry of Economy and Finance has recently launched a $200 million credit guarantee scheme to provide small and medium-sized enterprises (SME) to help businesses sustain the ongoing Covid-19 crisis. The Business Recovery Guarantee Scheme (BRGS), under the ministry’s Credit Guarantee Corporation of Cambodia Plc (CGCC), will widen access to formal loans from participating financial institutions (PFI) for working capital, investment, and business expansions. The primary mission of the scheme is to provide credit guarantees to PFIs to support and assist financially viable businesses that lack collateral to secure loans. Eligible applicants under BRGS must be businesses whose majority shares are owned by Cambodians. CGCC’s guarantee will act as collateral or security for 70% to 80% of the loan amount to be borrowed. The PFIs in this scheme include ACLEDA Bank, Cambodia Post Bank, Asia Pacific Development Bank, AMK MFI, Canadia Bank, Phillip Bank, and Prince Bank. (Khmer Times)

Thai bourse ‘the highest’ fundraiser for ASEAN firms. The Thai stock market has the highest fundraising value among ASEAN countries in the first quarter of this year. According to data from the Stock Exchange of Thailand (SET), Thailand’s fundraising as of February 2021 was 46.1 billion baht ($1.48 billion). In the first quarter of 2021, five companies launched initial public offerings (IPOs) with a market capitalization of 217.41 billion baht at IPO price. Of those companies, PTT Oil and Retail Business (OR) and Rojukiss International (KISS) were listed on the SET, while Jakpaisan Estate (JAK), TQR, and President Automobile Industries (PACO) were listed in the Market for Alternative Investment. It is also notable that up to 30 companies in properties funds, real estate investment trusts, and infrastructure funds are expected to be listed in the Thai stock market this year. (Phnom Penh Post)

Cambodian rice price upon the international market. The price of Cambodian milled rice on the international market has seen a slight uptick in the first quarter of 2021. According to a price list compiled by Cambodia Rice Federation (CRF), the premium “Malys Angkor” brand of fragrant rice is currently worth $825 per ton, an increase of 1.10% from 2020. The premium soft-cooking white rice costs $585 per ton, a rise of 2.99%, and premium-quality organic parboiled rice is $585 per ton, a surge of 1.74%. The new standard-fragrant rice (SKO) fetch $765 per ton. Last year, Cambodia exported 690,829 tons of milled rice. Shipments of milled rice to China weighed 289,439 tons, accounting for almost 42% of total export. (Phnom Penh Post)

Macro-economy

Duty-free access to VN for 31 tariff lines. The Ministry of Commerce has recently announced that 31 Cambodian tariff lines (mostly in agricultural products) will carry zero rates to neighboring Vietnam for 2021-2022. This comes as the Bilateral Trade Facilitation Agreement for 2021-2022 was formally ratified after the completion of internal procedures, with retroactive benefits for exports. The agreement is made to drop import tariffs on dozens of products which are to be renewed every two years. However, the goods covered in the deal are determined every year. As part of the agreement, Vietnam will provide duty-free quotas on 3,000 tons of dried tobacco leaves and 300,000 tons of milled rice this year. This agreement will strengthen trade relations between the two countries and boost economic growth. (Phnom Penh Post)

ADB GREEN PROJECTS GAIN $300 MN. The Green Climate Fund (GCF) has granted $300 million to the Asian Development Bank (ADB) to assist in creating environmentally-friendly infrastructure projects that aim to help economies in the region recover sustainably and create jobs. The ADB said the funds will be utilized by the ASEAN Catalytic Green Finance Facility’s (ACGF) Green Recovery Program to support green infrastructure projects in ASEAN member nations, specifically in Cambodia, Indonesia, Lao, and the Philippines. The ACGF provides ASEAN member governments with technical assistance and access to more than $1.4 billion in loans from the   ASEAN Infrastructure Fund and co-financing partners: ADB, Agence Francaise de Development, the ASEAN Infrastructure Fund, the European Investment Bank, the European Union, KfW and the Republic of Korea. This program is designed to support green infrastructure investment which will create climate-friendly jobs and reduce greenhouse emissions. In Cambodia, the ADB has been involved in the investment in a number of solar farms, hydropower, and biomass projects. These funds will help to stimulate green investment within the country and help to create a clean and environmentally friendly economy. (Khmer Times)

UNEMPLOYMENT RATE IN CAMBODIA, THE LOWEST IN ASEAN. All 10 ASEAN member states have faced a sudden increase in unemployment in 2020 as a consequence of the global pandemic. However, Cambodia has the lowest unemployment rate among the bloc. According to World Bank’s Unemployment Rate 2020, the unemployment rate in Cambodia was only 0.31%, while Lao PDR 0.95%, Thailand 1.02%, Myanmar 1.79%, Singapore 5.19%, Malaysia 4.55%, Indonesia 4.11%, Philippines 3.36%, and Vietnam 2.27%. Brunei has the highest unemployment in ASEAN at 8.37%. The ongoing global pandemic has left severe damage on the economic and labor market which led to an increase in the unemployment rate.