Cambodia Looks for Protection Under WTO Umbrella

Commerce Minister Cham Prasidh says he will meet with the World Trade Organization in Geneva next month and push the organization to “immediately” accept Cambodia as a member. 

Speaking at a briefing after a Thai-Cambodian economic cooperation conference last week, Cham Prasidh said becoming a member of the WTO is the only way to be competitive in the global economy and to avoid unfavorable bilateral trade agreements.

“We want to be immediately included in the [WTO] club,” said Cham Prasidh, who will lead a Cambodian delegation to Geneva on May 22.

Cambodia’s entrance to the WTO would guarantee the country Most Favored Nation status in the WTO community, which in­cludes all major industrialized nations, except the US.

“If we become a member, we will be protected by WTO rules,” the minister said. “It puts us on the same footing as other [developed] countries.”

By not belonging to the WTO, Cambodia is more vulnerable to the ups and downs of world markets, Cham Prasidh said. The country would be forced to enter trade agreements with economic giants who are free to impose tough conditions on Cambodia.

He singled out the 1999 US garment quota restricting the export of dozens of textile items to the US market.

Cambodia has criticized the quo­ta system, saying it slows down Cambodia’s growth in exports, though the garment export volume has increased from $360 million in 1998 to $900 million last year.

The quota agreement also re­quires Cambodia to improve working conditions in factories in order to earn bonus quota.

The three-year garment quota agreement signed in 1999 expires this year. Both countries have indicated the agreement will be renewed through the end of 2004, and could be extended further, Cham Prasidh said.

The WTO, meanwhile, has made it clear that no country can impose garment quotas on member countries after 2005.

“We will continuously suffer from [the garment export quota system if] we are not a member of WTO,” Cham Prasidh said .

Becoming a member of the WTO, however, may prove more difficult for Cambodia than meeting conditions for membership in Asean, which took several years.

Cambodia, which has been listed as a Least Developed Country by six agencies including the WTO, the World Bank and the International Monetary Fund, faces tougher entry requirements than richer countries.

Before gaining entry, LDCs must improve their trade sectors to adjust to the global economy. Cambodia would need to conduct a number of regulatory reforms, including reforming customs tariffs and trade administrative services.

Cham Prasidh maintained that the requirements for WTO membership are too tough for poor countries like Cambodia.

He said he will ask the WTO at the Geneva meetings to lower its standards for developing countries.

“I would like to try to promote the idea of the Least Developed Coun­tries joining the WTO through a fast-track process,” he said.

Cham Prasidh is scheduled to lead another delegation to an LDC conference in Brussels, Belgium, from May 14 to May 20, where he said he also will promote the fast-track idea.

 

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