Identifier
Created
Classification
Origin
07PHNOMPENH668
2007-05-15 04:05:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Phnom Penh
Cable title:  

CAMBODIA: SUCCESSFUL VISIT BY U.S.-ASEAN BUSINESS

Tags:  ETRD EINV CB 
pdf how-to read a cable
VZCZCXRO5073
OO RUEHCHI RUEHDT RUEHHM RUEHNH
DE RUEHPF #0668/01 1350405
ZNR UUUUU ZZH
O 150405Z MAY 07
FM AMEMBASSY PHNOM PENH
TO RUEHC/SECSTATE WASHDC IMMEDIATE 8421
INFO RUCNASE/ASEAN MEMBER COLLECTIVE
RUEHHM/AMCONSUL HO CHI MINH 0092
RUEATRS/DEPT OF TREASURY WASHINGTON DC 0685
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
UNCLAS SECTION 01 OF 02 PHNOM PENH 000668 

SIPDIS

SENSITIVE
SIPDIS

DEPARTMENT FOR EAP/MLS AND EB
DEPARTMENT PASS USTR
BANGKOK ALSO FOR FCS

E.O. 12958: N/A
TAGS: ETRD EINV CB
SUBJECT: CAMBODIA: SUCCESSFUL VISIT BY U.S.-ASEAN BUSINESS
COUNCIL

REF: A. PHNOM PENH 0345


B. PHNOM PENH 0531

PHNOM PENH 00000668 001.2 OF 002


UNCLAS SECTION 01 OF 02 PHNOM PENH 000668

SIPDIS

SENSITIVE
SIPDIS

DEPARTMENT FOR EAP/MLS AND EB
DEPARTMENT PASS USTR
BANGKOK ALSO FOR FCS

E.O. 12958: N/A
TAGS: ETRD EINV CB
SUBJECT: CAMBODIA: SUCCESSFUL VISIT BY U.S.-ASEAN BUSINESS
COUNCIL

REF: A. PHNOM PENH 0345


B. PHNOM PENH 0531

PHNOM PENH 00000668 001.2 OF 002



1. (SBU) Summary. In the latest of a series of trade and
investment related visits to Cambodia, a delegation from the
U.S.-ASEAN Business Council met May 9 with senior Cambodian
government (RGC) officials, including the Ministers of
Commerce, Finance and Health. ConocoPhillips representatives
urged the RGC to resolve the dispute with Thailand on the
Overlapping Claims Area in the Gulf of Thailand. RGC
officials believed resolution would have to await elections
and a new Thai government. The Ambassador and the head of
the Council's delegation, Frances Zwenig, urged Cambodia to
sign the bilateral debt agreement. The U.S.-ASEAN Business
Council's visit was another step toward greater American
commercial involvement in Cambodia and another indication of
the growing interest of U.S. business firms in establishing a
presence here.


2. (U) Building on the success of the first U.S.-Cambodia
meeting under the Trade and Investment Framework Agreement
and the April visit of a business mission of American firms
based in the region (Refs),the U.S.-ASEAN Business Council
met with senior Cambodian government (RGC) officials on May 9
to explore opportunities for trade and investment. Led by
Frances Zwenig, Counselor of the U.S.-ASEAN Business Council,
the delegation consisted of representatives of ConocoPhillips
Petroleum, Oracle, General Electric (GE),FedEx and ITT
Defense. They met with former Ambassador to the U.S. Roland
Eng and Minister of Transport and Public Works Sun Chanthol,
the Ambassador, and had office calls on Minister of Post and
Telecommunications So Khun, Minister of Commerce Cham
Prasidh, Finance Minister Keat Chhon, Health Minister Nuth
Sokhom and MFA Secretary of State Kao Kim Hourn.


3. (SBU) In each of the meetings, the ConocoPhillips
representatives urged the RGC to resolve the dispute with
Thailand over the Overlapping Claims Area in the Gulf of
Thailand. Noting that their firm has held a contract for
exploitation of the area for nearly ten years, they asked
that enthusiasm for Chevron's petroleum discovery not be
allowed to lessen the urgency of resolving the dispute. Kao

Kim Hourn told them that the two governments had come very
close to settling the dispute just prior to the fall of the
Thaksin government in Thailand. He said they had agreed on a
formula for dividing the revenue: 80% for Thailand and 20%
for Cambodia in the tier nearest Thailand, 50%-50% in the
middle and 20% for Thailand and 80% for Cambodia in the area
closest to Cambodia. He thought that an additional six
months of negotiations would have settled the matter.
However, in Thailand's current disarray, he said, there could
be no resolution until after Thailand's elections and the
formation of a new government. Other interlocutors,
including Cham Prasidh and Keat Chhon, agreed that nothing
could be accomplished until a new government was formed in
Thailand.


4. (U) GE announced to the Health Minister that it would
open an office in Phnom Penh in the coming months. The
office would focus on the sales and repair of diagnostic
equipment in the health field. The GE representatives
briefed the Minister on GE's program to sell refurbished
equipment in developing countries and asked that Cambodia
consider participating. They noted that GE's office could
be used as a launching point for GE in other sectors in which
GE is involved, such as energy.


5. (U) FedEx expressed appreciation to the Minister of Post
and Telecommunications for his flexibility in compromising on
regulations governing the courier service industry. The
revisions accepted by the Ministry had allowed the courier
service industry to remain operational in Cambodia. The
firms in the industry have all registered, they said, and
were functioning without problems. The FedEx representatives
also thanked Commerce Minister Cham Prasidh for his role in
convincing Minister So Khun to compromise.


6. (U) Showing signs that he was still recovering from a
heart procedure that he underwent in Paris in April, Prasidh
provided the delegation with an overview of the trade and
investment climate in Cambodia. Reviewing the establishment
of the garment industry, Prasidh stressed the need for
Cambodia to outperform its neighbors in order to remain
competitive. He explained the private sector forum that

PHNOM PENH 00000668 002.2 OF 002


brought the private sector together with government in order
to resolve policies and problems that inhibited business. In
response to a suggestion that Cambodia could use the latest
technology to computerize its "One Stop" investment service,
Prasidh said that other ASEANs were more technically advanced
than Cambodia. At best, Cambodia could become a model for
the second tier of developing countries in ASEAN like Laos
and Burma.


7. (SBU) Frances Zwenig asked Finance Minister Keat Chhon
for an update on the status of negotiations on the bilateral
debt. The Ambassador urged Keat Chhon to move forward and
accept the agreement as it now stood. Further discussions
were unlikely to get Cambodia a better deal. Keat Chhon
responded that the RGC had been considering sending a team to
Washington or inviting the USG to have a team visit from
Washington.


8. (U) Comment: Coming on the heels of the successful first
TIFA meeting in February and the American Business Mission in
April, the visit of the U.S.-ASEAN Business Council was
another step forward toward greater U.S. commercial
involvement in Cambodia. It was also another indication of
the growing U.S. business interest in Cambodia. Increasing
numbers of American firms are beginning to sense that
Cambodia has real potential.
MUSSOMELI