Hey, I feel like a fish out of water if I am just too free. Let me share something with you. it is about ASEAN. ASEAN is an abbreviation of the words “Association of South East Asia Nation”, which comprises of 10 states with the population of roughly 500 millions. Some people would have heard about the 2015 deadline or the AEC (Asean Economic Community), but they would probably do not know what the heck is that. Maybe some would refer to the community such as European Union where single currency has also been adopted. More than that, Cambodian citizen or even some policy makers have still not clear about what are the benefit of being integrated and what are cost. Public awareness on the matter is very limited, and the research on the such topic have non. And it is always believed that it is just good. There are 4 elements of AEC 1). Single Market and Production Base, 2). Competitive Economic Region, 3) Equitable Economic Development and 4). Integration into the Global Economy. Here, I would have my say on the first point “ Singple Market and Production Base” which focuses on other 5 sub-elements: a. Free flow of goods, b. Free flow of services, c. Free flow of investment, d. Freer flow of capital; and e). Free flow of labor. Let see some strength and weakness, giving the current economic structure and conditions. Some positive points have frequently raised: Once the integration comes, we can access and expand exports market. But wait.....do you think now Cambodia does not have big market?? Cambodia can access to US under the GSPs, to EU under the GSPs and Everything but Arms, to China, Japan, Korea, Australia, New Zealand, India etc. under the bilateral trade and investment agreement. Those are just too big enough for Cambodia export market. But question raised “does Cambodia have adequate or standard quality goods to provide them”??? It is also mentioned that there would more capital and foreign investment inflow to Cambodia and would create more job as low labor cost and labor surplus are Cambodian strong comparative advantage. But wait........there are a lot of complaint from the farmers that they do not have people to work for though they tend to increase their daily wage. To put in the nutshell, just right now Cambodia has already faced a shortage of labor supply by herself. Many young people are migrating to work abroad such as Thailand, Malaysia, Korea and so on. As labor movement is unrestricted, do you think will there be a lot of good quality investments come to Cambodia where costs of electricity and doing business are one of the highest in the region?? or they just start up investments in Thailand or Malaysia and use cambodias labor?? It has been, furthermore, voiced that the integration would bring more foreign tourists to the nation, leading to boost domestic demand and stimulate the growth of domestic supporting industries. But wait......Cambodia is still importing a lot, lot of food, vegetable, fruit and other related-material for supporting the tourists. Domestic business chains tend to be invisibly small. Moreover, main players in the tourist sectors such as hotel and restaurants are foreign owed. The income would transfer to their home countries. Technology and skill spillover is one of the benefits as it is necessary to promote domestic productivity and enhance domestic skill worker. But wait....how is Cambodia going to benefit from such thing as even now we already lose control on the labor movement. What if the open up during the integration leads to the huge outflow of labor? The domestic production would hurt and lose comparative advantages as they need to pay same wage as that of Thailand or Malaysia to retain workers. At this point, it clearly indicates that Cambodias exported goods to the international markets no longer enjoy lower price benefit. It costs same as those of Thailand, Vietnam or Malaysia, yet, maybe, lower quality. Then, who gonna buy??? …..lazy to discuss more here about the merit and dismerit.......just run out of feeling.....:) There is no one way fit all. And there are pros and cons once walking such way. Yet, it really depends on us how well we prepare for the time being? What level should we open?? what policies should be revised or newly created (Cambodias law is too hard to amendment, no matter what). Please note that many advanced countries such as Japan and EU members have not widely opened up it agricultural sector to the outside world. The idea is that they protect their farmer or the poor. Do Cambodia have such policies?? any backup for the small domestic investors?? Any incentives for domestic investors? Any specific sectoral development program or plan?? There are benefits of the integration. But, whether it exceeds cost or not is heavily relying on the policies adoption and flexibility. Still million questions and worries in my mind........................ Sorry I am just too bored to be free here. Writing is a way to reduce stress sometimes.......:) Just a perspective from a tiny angle.
Posted on: Tue, 08 Jul 2014 16:21:16 +0000
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