Soeharto's trip to Cambodia seen boosting economic ties
Soeharto's trip to Cambodia seen boosting economic ties
PHNOM PENH (Reuter): A landmark visit by Indonesian President Soeharto to Cambodia this week paved the way for a number of agreements aimed at boosting weak economic ties, officials said.
The agreements, signed after talks on Tuesday between Soeharto and co-premiers Prince Norodom Ranariddh and Hun Sen, included a trade pact, a memorandum of understanding on oil and gas cooperation and an exchange of notes on a joint commission.
Soeharto arrived on Monday, his first trip to Cambodia since 1968, with a delegation including Foreign Minister Ali Alatas and a number of businessmen. He left yesterday.
Alatas said the trade pact built on an umbrella economic and technical agreement already in existence for several years.
He said the joint commission would oversee and regularly review economic cooperation in various fields.
"We will now start negotiations on an investment protection and promotion agreement and an agreement on the avoidance of double taxation," Alatas said on Tuesday.
He said these pacts would hopefully be signed soon.
The agreement between Indonesia's state oil company and the Cambodian government included training and the possibility of future upstream and downstream cooperation, Alatas said.
He said Indonesian involvement in offshore exploration and exploitation depended on success in open bidding.
Cambodia and Indonesia also agreed to follow up a 1969 aviation pact with negotiations among airlines from the two countries.
Cambodian officials welcomed the signing of the new pacts, saying they should help strengthen weak trade and investment ties between the two historically close nations.
"We have to develop more trade between our two countries," Commerce Minister Cham Prasidh told Reuters, adding that two-way trade only amounted to $10-15 million each year.
Secretary of State for Finance Chanthol Sun said Indonesian investment in Cambodia, whose economy has been ravaged by decades of war, was disappointing.
He did not give figures but an Indonesian embassy official said accumulated investment was worth $30 million. Most is in telecommunications and real estate.
Potential Indonesian investors have said they were waiting for greater political stability in Cambodia, which has been ruled by an uneasy coalition government set up following UN-run elections in 1993.
Chanthol Sun said a "lack of awareness" rather than political instability was responsible for modest Indonesian interest.
Alatas said trade and investment was below potential and he hoped the planned agreements on investment protection and promotion would attract more Indonesian attention.