Cambodia 20240520: Momentum, Collaboration, Spotlight

Mekong Memo Cambodia Weekly: Business, politics, finance, trade & legal news.

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Headlines:

Canal Bring Economic Gains, Geopolitical Worry

Infrastructure Plan Draws China-Japan Rivalry

Banks Navigate Profit Dip, Embrace Innovation

Trade and Export Growth Showing Strength

Cambodia Angkor Air Expands Internationally

Chinese Warships Dock, Raising Eyebrows

North Korean Threat Puts SK Embassy on Alert

Cambodia Gets Big Bucks As Economy Grows

Artist Association Takes on Social Media Disputes

Reflections on 50 Years of ASEAN-Australia Ties

Diplomatic Roundup: CA, AU, KR, AT, CH, RU

China Shows Off Robot Dogs in Cambodia Drills

Balance in Urban Heritage Preservation

Rithy Panh’s Pol Pot Documentary Premieres at Cannes

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Canal Bring Economic Gains, Geopolitical Worry

We don’t want to beat a dead horse, but Cambodia's $1.7 billion Funan Techo Canal project is still the top story this week, with supporters touting its potential to boost the economy and critics raising environmental and security concerns. The Chinese-backed project plans to connect Phnom Penh directly to the coast, reducing transport costs and reliance on Vietnamese waterways. Vietnam fears the canal could facilitate Chinese military presence and impact the Mekong River's ecosystem. Cambodian officials say the project has only domestic origins and benefits, denying links to the Belt and Road Initiative.

Read more: Khmer Times (Domestic focus), Khmer Times (Construction urgency), Cambodianess (Economic benefits), Stratfor (Geopolitical impact), SCMP (Public concerns), The Diplomat (Vietnam tensions), Khmer Times (PM Statement)

Infrastructure Plan Draws China-Japan Rivalry

Cambodia has unveiled a $36.6 billion master plan to transform infrastructure over the next decade, with China and Japan eagerly vying for a piece of the action. The plan, which includes expressways, high-speed rail lines, and a (THE?) shipping canal, is thought to be necessary if the nation is to rise to the rank of an upper-middle-income country by 2030. While China focuses on expressways and rail projects, Japan is leading the charge on port expansion and wastewater facilities.

Read more: Al Jazeera

Banks Navigate Profit Dip, Embrace Innovation

Domestic banks are feeling the pinch, with profits dropping by $416 million last year. The National Bank of Cambodia is stepping in with a new financial development strategy to support the sector. Meanwhile, partnerships with South Korean banks, including a cross-border QR code payment system, are driving financial innovation and digital transformation. It seems that the banks are working hard to improve service offerings and operational efficiency, which should help them weather the storm and emerge stronger.

Read more: Cambodia Investment Review (Bank profit decline), Khmer Times (Financial sector strategy), The Korea Herald (QR payment partnership)

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Trade and Export Growth Showing Strength

Trade and exports are on the rise, with a 14.2% increase in trade with ASEAN countries and China emerging as the top agricultural trade partner. The garment, footwear, and travel goods sector is also making strides, with exports totaling $3.76 billion, a 17% increase from the previous period. Fresh coconuts and black pepper are among the top performers for agricultural exports.

Read more: Cambodianess (ASEAN trade), Cambodianess (Agricultural trade with China), AKP (Garment and footwear exports)