Cambodia outperforming other Mekong exporters: ANZ

PHNOM PENH - While exports in the Greater Mekong 5 (Cambodia, Laos, Myanmar, Thailand, and Vietnam) have increased over the last two decades, the pace of growth in exports has slowed significantly since the 2007-08 Global Financial Crisis – except for Cambodia, where exports have grown at a faster pace in the post-crisis period.

Having averaged CAGR (Compounded Annual Growth Rate) export growth of around 15.5% in the five years before the crisis, this increased to around 16.2% in the five years since the crisis compared to regional peers and the global norm of collapsing export growth, according to research by ANZ Bank.
“One likely reason for Cambodia’s trade outperformance is the high proportion of exports accounted for by clothing and apparel,” ANZ says. As clothing and apparel are typically purchased out of disposable income, there wasn’t the same collapse in demand for “(these sectors) compared to (say) spending on consumer electronics. This probably insulated Cambodia.
“Still, the composition of Cambodia’s trade has also been improving over this period. Although clothing, textiles, and shoes still make up almost three-quarters of total exports, the share of ‘other’ items has risen to 19.5% in 2014 from less than 1% in 2004.

“This suggests that exports are slowly moving away from traditional shipments of low value-added production. If Cambodia continues to follow this path, its strong trade outperformance of recent years looks set to continue,” ANZ says.  www.live.anz.com (ATI).