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Soybean exports to rise on high prices
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| A woman displays her soybeans for sale at Phsar Kapko market in Phnom Penh last week. Photo by: Meng Kimlong |
Vietnam, Cambodia cooperate in rubber planting
(VOV) – Vietnam is
currently implementing rubber growing projects in Cambodia, aiming to
plant 100,000 hectares of rubber trees in five Cambodian provinces by
2012.
The projects are part of a
trade promotion plan approved by the Prime Ministers of both countries
at the Vietnam-Cambodia business conference in April 2011.
A seminar was held in Phnom Penh on May 27 to offer tax reductions
and exemptions for businesses involved in rubber growing projects in
Cambodia.
Cambodian officials highlighted the significance and benefits of
these projects, saying that the projects helped upgrade infrastructure,
provide clean water, build houses for workers and pagodas for religious
followers, thereby improving local people’s incomes.
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Palm oil plan for loss
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| Workers unload palm oil fruit from a truck into a processing plant in the north Sumatra province of Serdang Begadai this week. Reuters |
this year, although they will generate revenues of US$20 million,
according to owner Mong Reththy.
The firm has continued to
increase the size of its plantations, anticipating producing 20,000
tonnes of refined palm oil this year, from 15,000 tonnes last year.
Larger plantations will make the enterprise more profitable, he said.
“Output
of oil has increased because of an expansion in plantations last year,”
he said, adding the company’s palm oil revenues this year were expected
to be some $2 million below break-even.
The firm’s current
plantations in Preah Sihanouk province cover an estimated 10,000
hectares. Mong Reththy Group currently exports palm oil to buyers in
India and the European Union at $1,100 per tonne, about the same as it
achieved last year.
Ministry of Agriculture, Forestry and Fishery
Secretary of State Chan Tong Yves said the palm oil plantation ought to
become profitable as the area under plantation increases each year, in
response to growing international demand.
“The development of this sector will provide more job opportunities and also uphold the Cambodian economy,” he said
Mong Reththy Group first began producing palm oil in Cambodia in 1996.
In March, Bursa Malaysia-listed Golden Land Bhd said it aimed to obtain two concessions for palm oil in Koh Kong province.
Meanwhile,
palm oil climbed to the highest level in more than six week yesterday,
on concerns that stormy weather in the US may further delay the planting
of soybeans, and as importers stepped up purchases of the tropical
cooking oil.
The August-delivery contract gained as much as 0.6
percent to 3,438 ringgit (US$1,130) per tonne on the Malaysia
Derivatives Exchange, the highest level since April 11, and ended the
morning session at 3,433 ringgit. ADDITIONAL REPORTING BLOOMBERG
Top ups go high-tech
scratch cards in Cambodia as the primary method for adding credit to
prepaid mobile phone accounts, company insiders said.
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| A V-Load sign adorns the door of a VIP Mini Mart on Sothearos Boulevard in Phnom Penh yesterday. Photo by: Sovan Philong |
Refresh
distributes a handheld device that independent dealers use to sell
top-up authorisation codes, thereby eliminating mobile operators’ need
to produce scratch cards outside the country, import and then sell them,
company officials said.
“We eradicate all those costs immediately,” said Ian Watson, Refresh Mobile’s founder and a major investor.
Dealers
sell top-ups in commons amounts, such as US$5, $10, $20 and $50.
Refresh’s devices then connect wirelessly with the company’s computer
servers to generate the authorisation codes typically held on scratch
cards. A receipt containing the code is printed and given to the
customer.
Information can be displayed in both English and Khmer,
making the devices more accessible to a larger number of Cambodians,
Watson said.
He claimed companies can save between $1 million and
$2 million by using Refresh’s top-up machines, in addition to getting a
measure of security scratch cards cannot offer. While scratch cards can
be stolen and resold, stolen top-up machines are immediately disabled
by Refresh, company officials said.
Watson also touted the
device’s ability to deliver real-time data for mobile operators, as well
as advertising to customers on the printed receipts.
At present
there are over 6,500 devices in 19 provinces across Cambodia, with plans
to have 12,000 on the market by the year’s end, according to Watson.
He
said Refresh so far has signed a deal with only Mobitel, which operates
the service under its V-Load brand. But the company is in “detailed
negotiations with a number of carriers ready to sign long-term
contracts,” he said.
Mobitel Chief Operating Office Kay Lot said
that while early adoption of Refresh’s electronic top-up devices was
slow, it has been picking up speed.
“We are beginning to see quite a positive take-up,” he said, adding, “This is where the future is going.”
Still, scratch cards will remain a popular top-up choice for some time.
“We recognise the tradition of scratch cards,” he said. “It’s not just something you can change overnight.”
Mobitel
General Manager David Spriggs shrugged off suggestions that Refresh
would cut into his company’s Cellcard Cash service, which among other
functions allows customers to top up their prepaid accounts via their
mobiles.
“They’re just different ways of topping up,” he said. “I don’t see any problem with having multiple options for customers.”
Although
Mobitel is the only one of Cambodia’s eight mobile operators presently
using the service, others have expressed interest.
Hello plans to hold preliminary discussions with Refresh, according to its Chief Executive Officer Simon Perkins.
He
said that while he’s interested in the technology, he does have
questions about its viability. Most importantly, he wondered if
consumers were ready to give up such a popular method of topping up
their mobile accounts.
“I think it’s complimentary to scratch
cards,” he said of Refresh’s offering, “but it’s not going to replace
scratch cards for a long, long time.”
Cambodia plans 3 bln U.S.D new town in Phnom Penh’s peninsula
A well-known local firm,
Overseas Cambodia Investment Corporation (OCIC), said Friday the
firm has received approval-in-principle from Prime Minister Hun
Sen to develop a new satellite city in Phnom Penh’s Chroy Changvar
peninsula.
the OCIC to develop the new town, now we’re working with the Phnom
Penh municipality in order to reach an official agreement,”Pung
Kheav Se, president of Canadia bank, the country’s third largest
bank, and chairman of OCIC, which is the developer of the current
Diamond Island City.
The would-be new town dubbed the Chroy Changvar, or “City of
the Future” project will cover the area of 387 hectares in Russei
Keo district’s Prek Leap area, just across Cambodia-Japan
Friendship Bridge (Chroy Changvar Bridge) from the central Phnom
Penh.
When this new mega-project comes online, it will be the fifth
satellite city project in Phnom Penh. The other four developing
satellite cities are Camko City, Grand Phnom Penh International
City, Koh Pich or Diamond Island City, and Boeung Kak Town.
Pung Kheav Se said that the expected new city would consists of
upscale development of residential units, condominiums, commercial
venues, shopping malls, financial centers, hotels, recreational
facilities, schools, hospitals, park, and a multi-purpose national
stadium.
It will take from 10 to 15 years to complete with the estimated
investment of 3 billion U.S. dollars.
He declined to disclose where the sources of the capital for
the development come from.
The development of new towns is the government’s strategy to
meet the growing economy and the population growth.
Phnom Penh is currently residing with about 1.5 million people.
It is estimated that the growth is about 20 percent year on year,
according to the city hall.
Garment fire claim in millions
million for a domestic insurance firm, according to General Insurance
Association of Cambodia Chairman Chhay Rattanak.
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| Smoke billows from the June Textiles factory during the March fire. A large insurance claim has been made. Photo by: Pha Lina |
The
claim would be based on the company’s assessment of its loses, but
according to a preliminary estimate, it would be between $15 million and
$16 million, said Chhay Rattanak.
“The amount will not be a
burden on the local company, as they have reinsured with a foreign
partner,” he said. Chhay Rattank declined to name the Cambodian
insurance firm yesterday.
“Our [GIAC] regulations do not allow a
local insurance company to handle this large an amount themselves, as
they don’t have enough ability to pay a big claim such as this – this is
defined by the law to keep the industry growing,” he said.
Ministry
of Economy and Finance Industry Division Head In Meatra said yesterday
Cambodia’s laws require a local company reinsure in certain cases with a
partner abroad, to avoid risk and keep the industry growing.
“A company in any country in the world cannot handle risk entirely on its own, requiring them to reinsure,” he said.
It
is thought June Textiles was insured by Campubank Lonpac Insurance Plc,
but officials from the insurance company declined to comment yesterday.
June Textile Director Albert Teoh declined to discuss the name of the insurance company, or the amount of loses yesterday.
“We cannot quantify,” he said. “There are a lot of losses. It should take months to complete the assessment.”
It will also take many months before the factory can resume operations, he added.
Forte
Insurance General Manager Youk Chamreounrith said it was common
practice in the domestic insurance industry to reinsure with reputable
foreign partners to spread risk.
“We don’t want to keep the risk
on our own, so we spread it to reinsurers, and they spread risk to their
partners as well, complying with international best practices,” he
said.
Chhay Rattanak said claims across the industry would increase this year compared to 2010, especially from property insurance.
However,
he said he was optimistic about the overall growth of the industry in
Cambodia, saying increased claims were not expected to cause severe
impact.
“We expect to keep growing at 20 percent each year – the MEF is careful, and strictly control [the industry],” he said.
GIAC statistics show premium revenue increase by 24 percent year-on-year in 2010 to $24.9 million.
US firms plan Cambodia plug
pressure in China, according to American Cambodian Business Council
delegates speaking in Hong Kong today.
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| A woman makes shoes at Sin Chn Hong Plastics Industry Company in the Phnom Penh Special Economic Zone last week. Photo by: Heng Chivoan |
Sciaroni said the organisation had held similar events in Singapore in
the past, but saw growing opportunity to attract US business located in
China.
“In recognition that we need to familiarise the US
business community there to the opportunities in Cambodia, we have
organised this mission to Hong Kong,” he said.
“Although
business there is traditionally focused on mainland China, a number of
businesses are looking at exit strategies as the competitive environment
makes business more difficult.”
The delegation will be led by US
Ambassador to Cambodia Carol Rodley. Delegates are to speak at Hong
Kong’s American Club today.
It comes as China faces concern over rising labour costs and price inflation.
Scott
Huff, a delegate and the CEO of Fair Manufacturing, which has factories
manufacturing pet treats in both Cambodia and China, highlighted in the
Kingdom’s growth potential.
“China is, and will remain a top
investment destination. It has plenty of resources for manufacturing and
easy transportation methods, unlike Cambodia, where shipping goods is
still fairly tricky,” he said yesterday
“Yet, the pressure is
really starting to mount in China, while it feels like there are more
growth situations in Cambodia, rather than restraints.”
As an
alternative, the delegation will highlight low labour rates, a young and
enthusiastic workforce and a liberal investment climate as Cambodia’s
prime attractions, he said.
“The average age of the Cambodian
workforce is around 25 years old, they are young, energetic and
determined to learn, additionally China’s labour rates are 3 to 4 times
the price of Cambodia’s, ” he said.
“However, the appeal goes beyond the cost of labour, it’s the availability.”
The
delegation primarily aims to attract investors affected by recent
labour shortages. The garment sector in particular is under pressure,
while in Cambodia the industry continues to advance, according to Huff.
The agriculture sector presented another growth opportunity in the Kingdom.
“I
think it’s highly likely agricultural products will have a strong
future in Cambodia – the industry is bound to be successful,” he said
Sciaroni expects the delegation to raise interest among Hong Kong based
companies as previous missions to Singapore have done.
“There is a
concentration of multinational corporations, law and accounting firms,
and others that rivals that located in Singapore. And we hope that we
can generate interest to have a business mission from Hong Kong to
Cambodia later this year,” he said.
“So AmCham Cambodia sees great merit in having a mission to Hong Kong.”
