Cambodia and Myanmar are the ASEAN countries most strongly economically dependent on trade with China, with Australia the nation in Asia-Pacific that is most reliant on Beijing, according to the Global Peace Index 2023.
The report showed that Australia has 30 percent of its trade with China, while Myanmar and Cambodia have 28 percent of trade with Beijing.
Laos has 27 percent of its trade with China, Vietnam has 26 percent, and Indonesia has 21 percent, the report added.
However, Hong Vannak, an economic researcher at the Royal Academy of Cambodia, said Cambodia's economy does not only rely on China but also on other countries, such as the United States, Australia, Japan, South Korea, Vietnam, Thailand, Singapore and others.
“China has a large market share in Cambodia. Despite that, it doesn’t mean Cambodia’s economy is dependent on China. Regarding this, it means Cambodia sees China as a big market to absorb Cambodian’s almost every type of products,” he told Kiripost.
Since China stands as the second largest economy in the world, it has a strong production force. Therefore, its market share to other countries is enormous, he added.
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Vannak said that the reason Cambodia imports more goods from China is because China is a huge producer with bountiful products.
In contrast, Cambodia is a developing country and is incapable of producing all of the daily products needed domestically, he said, adding that the country is still in need of raw materials from Beijing.
He added that the price of Chinese products is also affordable for Cambodians.
“It doesn’t mean Cambodian citizens don’t want to use US or Japanese products, but most Cambodians can afford Chinese products more than any other country,” he said.
Nith Kosal, a co-founder at Sethakech, said the size of Chinese trade in Cambodia is larger than other countries when compared to foreign index investment.
“It’s hard to answer the benefits and disadvantages of China on the whole Cambodian economy. Overall, China provides income and significant economic growth. We can see most of the factories are owned by Chinese companies,” he said.
“Therefore, Cambodia gains benefits, including in real estate investment, land, the infrastructure sector, manufacturing and also in agriculture investment.”
As a small and open economic country, the Cambodian government is always seeking more foreign investment to foster economic growth, Kosal said, adding that he hopes to see Cambodia have an independent economy to help avoid unforeseen risks.
“Overall in a country, if we can have our own economy running with small or big enterprises that can run well, stand strong by themselves and make the economy grow well is a good thing,” he said.
He added, “If we are co-dependent on other countries’ economies, we will face high risks. For instance, as we saw in the real estate and infrastructure sectors during Covid-19, Chinese investors returned to their home country.
“It causes real estate prices to continue to increase; in contrast, the purchasing and selling in this sector was decreasing and sometimes got stuck.”
He said that policy-making plays a pivotal role in encouraging more local investors to have additional capability to expand their businesses and more capital to invest in other sectors that still do not have local investors, such as manufacturing, agriculture, processing industry and real estate.
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