Export Diversification: Product and Market Diversification, A topic to share before I go

Recently, there is a fear on the declining trend of garment industry, which is the main sector contributing to Cambodian Economic Growth. I have read a text book, issued by EIC on the topic of Export Diversification, published in June 2007. The book mentioned the requirement for Cambodia to seek for other sector to complement for the garment industry since the the Agreement on Textile and Cloth (ATC) ended in 2005. Diversifcation from garment to other industry for Cambodia economic short and long term growth.

What is the most important the book mentioned some potential industry that can be the leading indutry based on the concept of Reveal Comparative Advantage (RCA) introduced by Balassa in 1965. The industry where Cambodia are found to have this RCA are Organic Rice, Cashew Nuts, Rubber, Silk and Tourism.

Market Divesification, it is true that the market for garment is concentrated in US and EU. However, in EU alone, the export ratio by EU members is unequally and some countries dose not import garment from Cambodia. It is important for Cambodia to look for other markets. What kind of market should we enter, if the competition by Veitnam or China and other is so much aggressive? Well, first country where MFN is available or EPA(Economic Partner Agreement) is availabe is the first to consider.

There is one more opportunity raise by the EIC report it is the shoes production where Vietname and China as EU is imposed anti-tariff for their unfair subsidy by their respective government. 

My idea, in the interim the shift from one industry to other we have to consider the following:

• Industry where cost of switching is low
• Adaptive capacity is enough
• High potential for growth
• Enough input for the shift
• Long term expect on maturization
• Flexible of human input  and knowledge

Not only diversification toward other export product but even in the garnment industrty we have to switch from particular product to a similar one before to the different one. For example from cloth to shoe production.

Who should play role in this diversification? I thinks the most important leader should be the government. Government incentive as well as state production would be required. Also the private firm is the second to come as it is well know for it efficiency in comparison with state-owned firm.

Oh, it is 4:13 am now, I have to leave for the flight. CU when I am back.  

Source: Export Diversification and Value Addition: For Human Development-June 2007, published by Economic Institute of Cambodia.
   

One week is over, Vocation is arriving

For the whole week, I have been trying to finish many reports and exams. I feel very tired. It did take alot of effort to write those Japanese report and prepared for the exam. Anyways, I did all the works. Hopefully, the result will be good.

Who knows, following the course in Japanese language, listening Japanese language, reading Japanese Kanji  is not as easy as English one. Haha, that why most students come only to GSID and GSL. No one love Graduate School of Economics. Lucky or not, I chose it. Sometime, I do feel a hard work for me but it is fine.  I can do it, I just need some motivation  and support.  Then, I told myself work hard for the goal. I came here with a goal to accomplish. Gambarimasu!