Cambodia Gets UK Reprieve With Extension of Developing Countries Trading Scheme Until 2032

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Cambodia Gets UK Reprieve With Extension of Developing Countries Trading Scheme Until 2032
Prak Sokhonn (R), Minister of Foreign Affairs and International Cooperation, and UK Ambassador Dominic Williams (L). Photo: Ministry of Foreign Affairs and International Cooperation

The United Kingdom's decision to extend the Developing Countries Trading Scheme (DCTS) membership for Cambodia until 2032 - three years after the Kingdom graduates from the Least Developed Country (LDC) status - has been welcomed by the Cambodian government.

The decision is more important for Cambodia than the UK. The UK is Cambodia's 10th largest trading partner while Cambodia was the UK’s 97th largest trading partner in the four quarters to the end of Q3 2024 according to the latest data. 

With the Cambodian economy so centred on exports, maintaining deals with trading partners is a key cog in reaching the anticipated GDP growth goals which the Cambodian government has predicted will be 6.3 per cent in 2025 according to the Budget in Brief report for the Fiscal Year 2025 released by the Ministry of Economy and Finance (MEF).

Cambodia’s total exports rose by 16.9 per cent in 2024 with a value of US $26 billion according to the General Department of Customs and Excise of Cambodia (GDCE) compared to the total value of exports in 2023 which were valued at US $22.64 billion.

Image Credit - 31 January 2024 report trade and investment between the UK and Cambodia from the UK Department for Business and Trade

Based on the 31 January 2025 report released containing the statistics on trade and investment between the UK and Cambodia from the UK Department for Business and Trade,  total trade in goods and services (exports plus imports) between the UK and Cambodia was £682 million (approximately US $850 million) in the four quarters to the end of Q3 2024. this represents a decrease of 14.6 per cent compared to the four quarters to the end of Q3 2023. It should also be noted that all of the trade data between the two partners in 2023 was also down compared to 2022.

Of the total ending in Q3 2024 total:

  • UK exports to Cambodia amounted to £65 million (approximately US $80 million) which was a decrease of 48 per cent.
  • Total UK imports from Cambodia amounted to £617 million (approximately US 766 million) which was a decrease of 8.5 per cent compared to the previous year.
  • The main UK exports to Cambodia included; vehicles (cars), animal feed, clothing and textiles, tobacco & beverages.
  • The main UK imports of Cambodian goods included; clothing and footwear, cereals, travel goods and handbags.
  • UK visitors to Cambodia ranked 9th in 2024, with the Kingdom welcoming 115,148 guests - there are no direct flights between the UK and Cambodia by the start of 2025.
Image Credit - 31 January 2024 report trade and investment between the UK and Cambodia from the UK Department for Business and Trade

In December 2024, the UN confirmed Cambodia's “least developed country”  (LDC) graduation date will be on December 19, 2029, and hence the 3-year extension of the DCTS beyond this date.

What is the UK's Developing Countries Trading Scheme (DCTS)

The Developing Countries Trading Scheme (DCTS) entered into force on 19 June 2023 and replaced the UK’s previous Generalised Scheme of Preferences (GSP) and Cambodia has benefitted from both preferential trade schemes.

The DCTS applies to 65 countries that are either a least developed country (LDC) as defined by the United Nations. and low-income and lower-middle-income countries as defined by the World Bank.

Cambodia has several trade agreements with countries and regions, most notably the Regional Comprehensive Economic Partnership (RCEP). 

The US generalised system of preferences (GSP) applied to Cambodia from 1997 to 2020 but the US discontinued the benefits and it has not since been renewed. There is no clear indication that the US government under President Trump would reinstate the GSP.

Cambodia Economic News