Koh Kong SEZ supports vehicle giants in Thailand
published : 27 Mar 2017 at 20:25
writer: Khmer Times
The vice president of Koh Kong SEZ recently spoke to the <i>Khmer Times</i> on the special economic zone.
The Koh Kong Special Economic Zone (SEZ) located just two kilometres from Trat province provides jobs to around 9,000 workers. Thitidej Tongpatana, who is vice president of Koh Kong SEZ, recently spoke to the Khmer Times’ Chea Vannak on the special economic zone’s prospects and future plans.
How many factories are there in the Koh Kong SEZ, and what were the initial infrastructure problems that you faced?
First there was one factory in 2006, set up by Cambodian tycoon Ly Yong Phat, to assemble Hyundai vehicles. Then the number of factories steadily increased. Presently we have seven factories which employ more than 9,000 workers.
When we first started, we did have infrastructure problems. There were no mobile phone and internet connections and no banks and ATMs. Now, we have everything and we’re trying our best to attract investors to set up factories and manufacturing plants in the SEZ.
What are the main products manufactured in the SEZ and where are they exported to?
The products are electronic components for cars, sporting goods and assembled Hyundai vehicles. The electronic components for cars are for Mitsubishi and Toyota companies in Thailand. The assembled Hyundai vehicles are for the Hyundai plant in Thailand. These Japanese and South Korean companies have plants in Thailand and the factories in the Koh Kong SEZ support these plants.
The sporting goods are exported to Thailand, Japan and the United States.
How do you see the current skill set of Cambodian workers meeting the demands made by foreign investors?
The Cambodian labour force is split into two parts. The first is skilled labour, and these are the ones with vocational skills. The second is unskilled labour.
The good thing is that factories in the SEZ are providing training for unskilled workers.
What are the challenges foreign investors have to deal with before they decide to invest in the SEZ?
From my point of view, it is all related to infrastructure. Top most on their minds will be questions about the power supply. Many of the factories are into high-tech manufacturing and so they would need stable and quality electricity. The next would be questions about a clean water supply and the cost of purifying the water. Third would be a transportation system to take the manufactured goods back to Thailand.
These questions have to be answered before they sign contracts to invest.
For electricity, I think the Koh Kong SEZ offers one of the best rates in the country.
What plans does Koh Kong SEZ have to attract more foreign investment?
We have received requests from companies who are interested in opening factories in the SEZ. For certain, three companies from Thailand will open factories this year. One is a garment factory, the other a steel processing plant and the third is a beverage maker.
The garment factory will open in the middle of the year, followed by the steel processing plant and beverage maker in the third or fourth quarter.
Does Koh Kong SEZ have plans to be listed on the Cambodia Securities Exchange (CSX)?
At the moment we don’t have any plans to be listed on the CSX. Unlike the listed Phnom Penh Special Economic Zone, we are small in comparison. But in the future that could change when we have more factories in the SEZ. When that happens we will raise capital through an initial public offering and get listed on the CSX.
Cambodia and Thailand have agreed to have bilateral trade valued at $20 billion by 2020. Do you think that volume of trade could be reached by both countries in the given time?
I think both countries will be able to achieve this trade target. There is good rapport between the private sector and governments of both Cambodia and Thailand. So, I don’t think it will be a problem.