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Tuesday, May 22, 2007

Cambodia sentences two Taiwanese men 58 years jail for drugs

Phnom Penh - Two Taiwanese men were sentenced to 30 and 28 years in prison after being found guilty of trying to smuggle more than a kilo of heroin out of Cambodia late last year, a judge said Tuesday.

Judge Sao Meach of Phnom Penh Municipal Court said the two, for whom the court gave the Khmerized names as Yein Junasuch, 49, and Jy Sunglean, 59, had been found guilty of trying to board a flight to Hong Kong from Phnom Penh International Airport on October 20 last year carrying 1.4 kilograms of the drug between them.

The pair had been carrying the heroin in pairs of specially built-up shoes as well as on their person and their strange gait raised the suspicions of customs officials, the court heard.

Junasuch was given the harsher sentence as he was carrying more, Meach said.

Both men are expected to appeal the sentences.

The harsh sentences are thought to mirror increasing frustration by Cambodian anti-drug trafficking police after a string of Taiwanese and mainland Chinese have been caught at the airport smuggling drugs in recent years.

Cambodia does not have a death penalty.
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Cambodia-Thailand trade volume tops 1 bln USD

The trade volume between Cambodia and Thailand reached 1.279 billion U.S. dollars in 2006, 34.4 percent higher than 2005, local media quoted Cambodian Minister of Commerce Cham Prasidh as saying on Tuesday.

This is a remarkable and proud trade volume between the two countries, Cambodian language newspaper Kampuchea Thmey Daily quoted Cham Prasidh as saying.

The good trade relations between Cambodia and Thailand resulted from the border-crossing trade agreement which was approved between the two countries in February 2006, Cham Prasidh added.

Recently, Thailand has provided 340 kinds of products for selling in Cambodia without having to pay tax or paying very low tax, he said at a Thai Products Fair held in Phnom Penh from May 19 to 22.

High quality and luxurious products from Thailand are popular in Cambodian market, including construction materials, cosmetics, household goods, food, clothes, stationery, decoration materials and souvenir, the newspaper said.

Source: Xinhua
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Escape from Cambodia

Chheun Sean is glad to be living in New Zealand and enjoying all the freedom a peaceful country can offer.

Life has not always been peaceful for Chheun.

Born and raised in Cambodia, he came to New Zealand as a refugee 19 years ago.

He recalls those days as 'a very stressful time'.

"It took a couple of years to adapt to the New Zealand way of life and I couldn't speak any English back then," he says.

Chheun was a baby when the rebel uprising started in his home country and he says his parents became caught up in the crossfire.

"My father was captured and taken away to jail by rebels because he was suspected to be a spy. He was destined to be killed," he says.

However, one of the rebel leaders, who his father had grown up with, recognised him and vouched for his innocence and he was freed.

There was pressure for people to join the rebel movement back then, Chheun says.

"My parents would have had to join and I would have just been left on the streets to die because they would not have been able to take me with them and they would have had no choice."

A cousin of Chheun's did find himself in just that predicament but was luckily picked up by an uncle.

Chheun's parents farmed before the war and then they cooked food to sell, from their house.

"I used to have to sell the food on the streets in the mornings and then I would go to school in the afternoons," he recalls.

Because the schools were overcrowded, children would attend only half days.

However, Chheun's family opted to escape the inrest and they arrived in New Zealand when he was about 13.

Chheun's wife, Channdeth Uch, has been in New Zealand about eight years. The couple have two children, seven-year-old twin girls - Soktaera and Soktaeradh.
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Axis to spin at a bigger plant


JOHOR BARU: Second board-listed Axis Inc Bhd sees growing sales on the back of capacity expansion and wider customer base, said executive director Jimmy Koh Tee Jin.

The company is a semi-integrated textile and garments manufacturer. Its knitting and dyeing facilities are located in Johor while garment manufacturing is contracted to two factories in Cambodia and another in Vietnam.

Axis plans to spend between RM33mil and RM35mil in the next two years for capital expenditure (capex) to be funded via the capital market or bank borrowings.

“We have identified a piece of land in Johor Baru for our new knitting plant. We’re almost out of space at our knitting factory in Tangkak. We have to move if we want to increase our capacity and storage space,” he told StarBiz during a recent plant visit.

Koh said the shift to a bigger plant and closer to its dyeing factory would save as much as RM1mil a year on transportation costs.

Currently, the knitting factory is running at 100% capacity of 1.5 million pounds of fabric per month with 78 knitting machines.

Axis intends to boost that to two million pounds a month by adding 30 machines.

To control raw material costs, the company had a hedging mechanism in place for the purchase of yarns, which comprised more than half of operating costs, Koh said.

All the output from the knitting factory is consumed internally for the dyeing operations.

Given the increase in knitting production, Axis planned to install six new dye tanks to boost dyeing capacity by a further 10% to two million pounds of fabric a month, he said.

Two years ago, the company replaced dyeing tanks that were more than 10 years old due to their declining efficiencies.

“These old tanks use more water and require more power to run. It’s better to replace them,” Koh said, adding that utility costs comprised about 10% of operating costs.

The company also converted to natural gas from diesel at end-2005 as it managed to lock in the costs of natural gas with Petroliam Nasional Bhd. The move enabled Axis to save about RM250,000 a month.

As it aimed to cut cost by 30% within 12 months, it would pursue strategies in logistics management, fabric consumption, efficiency and productivity improvement, and production down-time savings via larger consistent orders in hand, Koh said.

As the company was building on dual production capability in knitted and woven garments, he said, it would put in the necessary infrastructure as well as retrain staff this year.

About 30% of fabrics produced at the dyeing factory are used for Axis’ garment manufacturing and the rest exported to other textile manufacturers.

“Our factories in Cambodia and Vietnam also import fabrics from Hong Kong, Taiwan and China as we do not produce all types of fabric that meet their requirement,” Koh said.

The plants in Cambodia and Vietnam have a combined capacity of 200,000 dozen per month with 7,000 workers and 4,200 sewing machines.

Axis does not own the foreign factories but has partnered local parties, as it requires less capex and reduces cross-border investment risks.

Koh said Axis supplied the machines and equipment as well as sourcing of materials while the foreign partners owned the land and factories.

It was also eyeing Indonesia and Myanmar to extend its contract garment manufacturing to take advantage of the cost efficiencies in these countries, he added.

Meanwhile, Axis planned to ramp the Cambodian and Vietnamese factories’ annual capacity to 250,000 dozen by year-end as well as install garment silkscreen printing machines at the factories, he said.

“We want to move up the value chain by playing on printing, embroidery and washing as they provide higher margins. Fabric design is also more complicated and with that we can ask for better margins,” Koh said, adding that Axis had to keep up with new technology in knitting, dyeing, sewing, silkscreen printing and embroidery to meet buyers’ requirements.

In terms of clientele, it has diversified its base in the past five years. In 2002, 70% to 80% of garment manufacturing output were attributed to GAP Inc but this had dropped to 10% now, Koh said, adding that other clients included Footlocker USA, Le Coq Sportif, NEXT and ECKO.

“We want to avoid concentration risk. We also try to reduce dependence on products with low margins,” he said.

Currently, the US clients comprise 70% of sales and Europe the balance.

“We hope to achieve a ratio of 60:40 in the next 12 to 24 months. The widening clientele base will boost annual sales by 15%,” Koh added.

On whether Axis would consider setting up a yarn factory in the future, he said it would only be “worthwhile” to do so if the company required six million pounds of fabric a month as the cost of a sizeable yarn plant was about US$100mil.

Axis hopes to transfer to the main board of Bursa Malaysia this year to gain higher exposure to institutional investors.

“We’ve already submitted an application to the exchange,” Koh added.
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Cambodia’s first-ever Moody's ratings

Phnom Penh (dpa) - The Cambodian government Monday welcomed its first-ever foreign currency and local currency government bond ratings from Moody's, saying the B2 rating represented a milestone.

In a joint government press release with the government's rating advisor Credit Suisse, Deputy Prime Minister Sok An said the rating represented a new era in financial transparency and foreign investment for Cambodia.

"The ratings are a milestone in improving investor confidence in Cambodia and show Cambodia's willingness to make public its financial health," Sok An said in the press release.

Cambodia also secured a B+ rating for long-term foreign and local currency government notes from Standard & Poor's, according to the press release.

Standard & Poor's also awarded a short-term foreign and local currency rating of B. Moody's assigned a foreign currency notes ceiling of B1, a foreign-currency ceiling for bank deposits of B3, and a local currency notes ceiling and a local currency deposit ceiling of Ba1.

Moody's said the ratings at least partially reflected a favourable offset of Cambodia's current account deficit against foreign-direct investment inflows and a build-up in official foreign exchange reserves to a level adequate in relation to the country's near-term debt repayments.

The continued success of the country's tourism and garment sectors as well as anticipated good returns from oil and gas reserves, on which commercial drilling is expected to begin within two years, were also contributing factors, it said.

"Cambodia has recently attracted significant inflows of foreign- direct investment into sectors such as tourism, garments and energy, which should help to continue to boost the overall level of investment in the economy as well as to strengthen the balance of payments," Moody's Vice President Thomas Byrne said in the release.

The release also quoted Standard & Poor's primary credit analyst Agost Bernad as saying real gross domestic product (GDP) growth averaging nine percent over the past six years had boosted Cambodia's per-capital GDP by 64 percent.

"There is reason to expect similar robust growth performance in the medium term, given the policy continuity, which focuses on export-led growth and stability in price and exchange rates," Barnad said in the release.

Credit Suisse said the ratings showed that the ratings agencies had recognized "significant momentum" in Cambodia's reform programmes.

The outlook for all ratings was given as stable, according to the press release. All short-term ratings and ceilings were not prime.
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Cambodia wants to link tourist flight to Myanmar

Cambodian Prime Minister Hun Sen made an official visit to military-ruled Myanmar on Monday to promote direct flights between the two countries, home to some of Southeast Asia's greatest cultural treasures, his adviser said.

"Burma has great tourist potential," senior Hun Sen aide Sri Thamrong told reporters at Phnom Penh airport on yesterday. "Not only are they followers of Buddhism but they also have beautiful temples so we could offer joint package tours."

Cambodia's 800-year-old Angkor Wat temple complex is largely responsible for an explosion of tourists to the war-scarred nation, which attracted 1.7 million visitors last year.

Cultural aficionados say the similar-aged Buddhist temples in Bagan in central Myanmar are a close rival to Angkor, but a chronic lack of infrastructure in the former Burma -- power cuts are a daily problem and foreign credit cards are rarely accepted -- means they attract only a fraction of the number of visitors.

Airlines in Thailand have tried to promote a similar "cultural package" in the region, with flights linking Angkor to the ancient Thai and Lao capitals, Sukhothai and Luang Prabang, and Hoi An in central Vietnam.

Cambodian government spokesman Khieu Kanharith said Hun Sen's talks with the Myanmar junta would not include the detention of democracy icon Aung San Suu Kyi, whose latest 12-month period of house arrest is due to expire this weekend.
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