Cambodia could overtake Thailand’s gem export market to the United States within five years, officials said yesterday. Thailand’s growing economic status could soon disqualify it for tax exemption when exporting gems to the US market, but Cambodia’s standing as a Least Developed Country would allow it to continue trading tax free.“US officials have told me it will likely happen within the next five years,” said Cham Prasidh, senior minister at the Ministry of Commerce, referring to Thailand’s gem trade being taxed. He said that the move would likely attract Thai traders to move their businesses to Cambodia. “I believe that some Thai traders may run to Cambodia to produce gems and jewellery, and then export from here because they would lose some customers if they were forced to increase their prices. They will have to come to Cambodia.”Cham Prasidh added that the move would likely help Cambodian gem traders increase their own profits, as businessmen and Cambodian gem traders could form partnerships with Thais who already had business in the States.Jiranun Wongmonkol, the ministry counselor at the Office of Commercial Affairs at the Royal Thai Embassy in Phnom Penh, confirmed that Thailand would lose its tax-exemption status when selling gems, but did not know exactly when the measure would be implemented.
Vietnam-based Dragon Capital is raising up to US$100 million for a new Indochina fund, some of which the private equity firm would invest in Cambodian agriculture and infra-structure, Dragon’s chief information officer Bill Stoops said yesterday. While the majority of the fund will be invested in Vietnamese companies, Stoops said there was considerable opportunity in Cambodia. “We believe there are a lot of big-ticket projects in Cambodia right now,” he said by phone, although he declined to name the projects. The firm will also look at some investments in manu-facturing, Stoops said
PRASAC, Cambodia’s largest microfinance institution by outstanding loans, planned to become a licensed commercial bank in the Kingdom, company officials said yesterday. The news comes despite calls from insiders and experts – most recently the International Monetary Fund and World Bank – for the National Bank of Cambodia to stop issuing new licenses for commercial banks.Prasac was preparing its core banking system, management and infrastructure for the transition, and targeting a launch date in 2013 or 2014, General Manager Sim Senacheert told the Post. “We want to transform into a bank because we would be able to offer more services and products to customers,” he said, adding that Prasac had not yet applied for a license at the National Bank of Cambodia.The MFI would not have difficulty meeting the NBC’s reserve requirement of US$37.5 million, Sim Senacheert said, as shareholders would be on hand to inject capital into the would-be bank. The NBC now holds $3.8 million in reserve capital from Prasac.ACLEDA Bank, the country’s largest commercial bank, transitioned from an MFI in 2001. President and CEO In Channy said he expected Prasac’s transition to be much smoother than that of his firm’s given consumers’ growing sophistication with financial services.