Cambodian bikes a big hit in Europe

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Cambodia bicyclesCambodia’s bicycle industry has maintained strong export growth to Europe last year, according to latest data released by the European Commission, making bike production a big success story that shows how effective diversification of Cambodia’s developing and fast growing economy can look like.

The country exported about one million bicycles to the European Union in the first eight months of 2015, a 16-per cent increase over the same period in the previous year, maintaining its place as the second-largest exporter to the bloc behind Taiwan.

Growth has been achieved despite the fact that the European Commission imposed anti-dumping duties on the import of certain bicycle brands from Cambodia (as well as the Philippines) in mid-May 2015 to put the brakes on flooding the market with Chinese-sourced models traded through those two countries.

However, the three biggest and most renowned Cambodian OEM bike makers, A&J, Smart Tech and Speedtech Industrial, are exempted from the 48.5 per cent dumping duty, while companies with links to Chinese manufacturers, Asia Leader International and Opaltech, are not exempted.

Before May 2015, the entire Cambodia bicycle industry had benefited from a zero-tariff arrangement with the EU as part of its Generalised System of Preferences, which grants trade relations between the EU and 49 of the world’s least developed countries duty exemptions – in fact duty-free access to the EU single market for all products excluding arms and ammunition. The duty imposed on Chinese-sourced bikes now shows wider efforts to scrutinise Cambodian exports to the EU.

Cambodia began producing and exporting bicycles in large numbers in 2006. The addition of new factories resulted in bicycle exports increasing more than ten-fold since then. Cambodia is now the second largest bicycle exporter to Europe. Production is driven by Taiwan-owned manufacturers which operate five of the six production facilities in the country, as well as a US firm.

Cambodia’s proximity to Vietnam also helps. Bicycle factories there are just across the border, which is important because a number of parts are still produced in Vietnam for shipment to Cambodian manufacturers. Cambodia’s low wages were also a major factor for foreign bicycle producers moving production there.

While garments remain the main export good from Cambodia, bicycles, the share of along with electronics, rubber, rice and wood is growing. As per latest available data of 2014, bicycle had the third-largest export market share behind garments and electronics at more than half a billion US dollar.

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Reading Time: 2 minutes

Cambodia’s bicycle industry has maintained strong export growth to Europe last year, according to latest data released by the European Commission, making bike production a big success story that shows how effective diversification of Cambodia’s developing and fast growing economy can look like.

Reading Time: 2 minutes

Cambodia bicyclesCambodia’s bicycle industry has maintained strong export growth to Europe last year, according to latest data released by the European Commission, making bike production a big success story that shows how effective diversification of Cambodia’s developing and fast growing economy can look like.

The country exported about one million bicycles to the European Union in the first eight months of 2015, a 16-per cent increase over the same period in the previous year, maintaining its place as the second-largest exporter to the bloc behind Taiwan.

Growth has been achieved despite the fact that the European Commission imposed anti-dumping duties on the import of certain bicycle brands from Cambodia (as well as the Philippines) in mid-May 2015 to put the brakes on flooding the market with Chinese-sourced models traded through those two countries.

However, the three biggest and most renowned Cambodian OEM bike makers, A&J, Smart Tech and Speedtech Industrial, are exempted from the 48.5 per cent dumping duty, while companies with links to Chinese manufacturers, Asia Leader International and Opaltech, are not exempted.

Before May 2015, the entire Cambodia bicycle industry had benefited from a zero-tariff arrangement with the EU as part of its Generalised System of Preferences, which grants trade relations between the EU and 49 of the world’s least developed countries duty exemptions – in fact duty-free access to the EU single market for all products excluding arms and ammunition. The duty imposed on Chinese-sourced bikes now shows wider efforts to scrutinise Cambodian exports to the EU.

Cambodia began producing and exporting bicycles in large numbers in 2006. The addition of new factories resulted in bicycle exports increasing more than ten-fold since then. Cambodia is now the second largest bicycle exporter to Europe. Production is driven by Taiwan-owned manufacturers which operate five of the six production facilities in the country, as well as a US firm.

Cambodia’s proximity to Vietnam also helps. Bicycle factories there are just across the border, which is important because a number of parts are still produced in Vietnam for shipment to Cambodian manufacturers. Cambodia’s low wages were also a major factor for foreign bicycle producers moving production there.

While garments remain the main export good from Cambodia, bicycles, the share of along with electronics, rubber, rice and wood is growing. As per latest available data of 2014, bicycle had the third-largest export market share behind garments and electronics at more than half a billion US dollar.

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