The MOU signing event, between Non-Bank Financial Services Authority (FSA) and the Indonesia Financial Services Authority (Otoritas Jasa KeuanganOJK), on August 7. CCC
Cambodia and Indonesia signed a Memorandum of Understanding (MOU) on financial services and to facilitate better business, trade and investment for both countries.
The MoU was signed by Mey Vann – head of the General Department of Financial Industry under the Ministry of Economy and Finance, and who is also secretary-general for the Non-Banking Financial Services Authority (NBFSA) – and Agus Edy Siregar, deputy commissioner for International Affairs, Anti-Money Laundering and Terrorism Financing of the Indonesian Financial Services Authority, in Phnom Penh on August 7.
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Cambodia Chamber of Commerce (CCC) vice-president Lim Heng told The Post on August 8 that the cooperation is a new effort by both countries’ financial sectors to give confidence to investors to work together, invest or do business in Cambodia and Indonesia.
“Indonesia is a good trading partner for our country. We receive [a lot of] foreign direct investment in various fields from them every year. Therefore, the MoU provides more confidence and trust to the businesspeople and investors of both countries,” he said.
In addition, Indonesia is one of the most populous countries in ASEAN, which means there is high demand for goods and services, thus, Cambodia is a good place for Indonesia to invest in, given the amicable investment climate in the Kingdom.
“Cambodia has an open economy. There is no discrimination between local and foreign investors, so Indonesia can look at the Kingdom as an investment destination, particularly in the agricultural sector. They can also export from Cambodia or supply locally under the regional and global free trade agreements that the Kingdom has made,” he said.
Hong Vanak, an economics researcher at the Royal Academy of Cambodia, told The Post that with geographical proximity, both countries are members of ASEAN and the Regional Comprehensive Economic Partnership Agreement (RCEP).
He observed that there is a big gap in Cambodia exports to Indonesia, which requires the government and private sector to work together to attract more Indonesian investors to Cambodia, as well as find potential products that are in high demand for export to Indonesia.
“The high amount of goods that Indonesia brings to Cambodia may be a result of products used as raw material or ingredients to complement the production or processing in Cambodia for export. Also, it is possible that because Indonesia is a member of the Group of 20, therefore the country’s export capacity is also very large,” he said.
On the other hand, the number of Indonesian tourists and investors in Cambodia is large, which has seen an increase in the import of halal food from Indonesia.
According to Indonesian Ambassador to Cambodia, Sudirman Haseng, in a Cambodia-Indonesia investment dialogue last year, the Indonesian Embassy would cooperate with the Indonesian Chamber of Commerce in Cambodia to boost the exchange of goods and encourage its investors to come and invest in Cambodia more.
The General Department of Customs and Excise stated that in 2022, bilateral trade totaled $948.5 million, up 48.3 percent from $639.7 million in 2021.
Of that, goods imported from Indonesia amounted to $911.7 million, rising by 50 per cent, and goods exported from Indonesia were only $36.839 million, an increase of 15.9 per cent.
Based on the data, Cambodia recorded a deficit of $874.9 million.
Last year, the Ministry of Tourism revealed a total of 2.3 million international tourists visited Cambodia, which was a surge of 1,058.6 percent from 2021.
Of these, 75,653 were Indonesian visitors, up 799.6 percent from 2021. Indonesian tourists account for 3.3 percent of the total number of international tourists in 2022.
