Exports fall 26.4pc in July as crisis in Kingdom continues [-Is there anything to worry about yet?]

Latest government figures show deterioration on export data from June, when total exports fell an annualised 17.5 percent

If this situation continues, the economic crisis ... will get unavoidably worse.

FIGURES released Tuesday by the Kingdom's import-export inspection body showed July exports plummeted an annualised 26.4 percent, a larger decrease than in June, suggesting the worst of the economic crisis is not yet over for Cambodia.

After showing a fall of 17.5 percent in June, Camcontrol figures indicated that exports fell to US$249.94 million last month from $339.43 million in the same period last year, meaning that the garment industry, which is responsible for about 90 percent of Cambodia's total exports, had not yet overcome the worst of the drop in global demand, particularly in key markets the United States and Europe.

"The decline in exports has affected Cambodia's economy since the beginning of the year and is not something new," said Chan Sophal, president of the Cambodia Economic Association.

"If this situation continues, the economic crisis in our country will get unavoidably worse and worse."
Aside from garments, the Kingdom's next largest export is agricultural products such as corn, beans and rubber.

Last week, the Ministry of Commerce said that garment exports had fallen 18 percent in the first half of the year to $1.27 billion, compared with $1.54 billion in the same period in 2008.

The Garment Manufacturers Association of Cambodia (GMAC) said Tuesday that it did not have the latest figures for garment exports. Business Development Manager Kaing Monika warned that although some markets, including Asia and Europe, had picked up in recent months, the United States - Cambodia's biggest export market by trade value - was showing relatively few signs of recovery.

"Whether it will get worse or improve, I am not sure yet because the impact of the global economic crisis is still continuing," he said in an interview Tuesday.

Though Cambodia's export figures continue to decline, a number of other export-dependent economies in the region have seen recent improvements, including China, Singapore and Taiwan.

Hong Kong, however, saw its exports worsen in July, down 19.9 percent year on year compared to with 5.4 percent in June, government figures said Tuesday.

Cambodia's total trade also declined last month compared to June.

The Kingdom recorded $574.52 million in total trade volume in July, down 24.2 percent on the same month last year. In June, the annualised total trade figure fell 16 percent, according to Camcontrol figures.

Despite the depressing figures, Khuon Savuth at Camcontrol's General Directorate said Tuesday that Cambodia's trade volumes regularly fluctuate, and that this year's total export volumes will not be severely affected, despite the effects of the global economic crisis.

"I think that the decrease in value of Cambodia's exports and imports may be about just 18 percent compared to last year," he said.

Official figures showed that July imports fell 22.4 percent year on year to $324.58 million from $418.4 million in the same month last year. Last month imports were down an annualised 14.5 percent to $360.1 million.

Much of Cambodia's imports are raw materials for the beleaguered garment industry such as cloth and thread, as well as foods and construction materials.