Cambodia: Government fails to recoup on rubber expenses

Despite a 31 percent increase in Cambodian, rubber exports, during the first 11 months of this year, the Ministry of Agriculture is failing to recoup on expenses it, has spent sending expert technicians into the field in order to help boost production.

A worker collects coagulated latex at a rubber plantation in Kampong Cham’s Memot district in 2014. Heng Chivoan

According to data from the Ministry of Agriculture, the government has spent $379,000 so far this year on technical support for rubber farmers and plantations, and has received only $299,000 back through revenue generated primarily through land rental fees.

Meanwhile, Cambodia’s rubber sector showed accumulated revenue of $249 million during the period by exporting 152,962 tonnes.

Khoun Phalla, a director of the rubber department at the Ministry of Agriculture, said that the government has established five teams of rubber experts that have been deployed across the country.

“We have helped the price of rubber,” he said. “It is now better for small-scale farmers.” Phalla added that the ministry’s experts have shown farmers how to increase yields at lower costs.

“What we have spent so far will be returned through higher profits from rubber farmers and that will eventually promote government revenue,” he said.

However, Hang Sreng, director of rubber exporter Long Sreng International, said that despite the government’s expert teams, the rubber sector would remain largely unprofitable unless the government scraps taxes.

“We do not make profits from rubber because we have to pay a lot of taxes and fees to the government and that makes us unable to compete,” he said. “The specialists have helped with efficiency, but that is not enough.”