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We Need to do a lot to Catch up our Neighbours

Darren Ly, MD, LH Group, Cambodia, spoke about Cambodia’s economy and its co-relation with gold and is highly optimistic that future demand of gold will increase (investment and jewellery) with growth of economy. Excerpts…

How is your economy growing and do you see any kind of co-relation between growing economy and demand of gold in Cambodia?

Cambodia as a country has been going through a lot of hardship. We have gone through a period of 38 years since independence. Due to the stable political condition, we are able to establish a rapid and fast pace economy. In last 15 years, we have achieved average annual growth of 7 percent. Due to the young workforce and dynamic economy, we are expecting that country will grow more substantially.

If you want to draw a co-relation with growth of economy and emerging demand of precious metals, as an investment as well as jewellery, one can find that it is co-related. Cambodians have good affinity to gold jewellery; they give gold jewellery as a gift to newborn and even during wedding, there is good practice to giving gold jewellery as a gift. In this context, I can say demand of gold for investment as well as jewellery will grow substantially with growth of economy.

Are you producing any gold at present?

At present, our government has issued ‘exploration licence’ to a few companies, both local and foreign. The largest deposit so far found is about 300,000 ounce of gold.

How is Cambodia sourcing gold in domestic market?

Since war is over, we have been using gold and rice as barter trade or we can say gold as form of currency. So, internally we do have some recycled gold; we also do have some import. The import quantity is not so much – recycled material is mostly used within the country.

What kind of gold (in respect of purity) does Cambodians like most?

In Cambodia, people like 9999 gold. customers are not inclined towards 18K gold. We also see some SJC gold bars from Vietnam here and there.

What kind of assistance are you anticipating from government to grow the trade?

Government has already taken first step by removing import tax on gold. But, certainly lot of works to be done to catch up our neighbouring countries. For example, we do have only 3 or 4 prominent trading houses at present. There is need for all these trading houses to come together and form an association and talk to the government in regard to withholding tax of 1 percent, which I believe at this point of time, is the stumbling block for the gold industry. If this issue has been sorted out, I believe that this tax will be removed and demand for gold in Cambodia will grow tremendously.

Did you find APPMC fruitful?

This is very good conference for me. I have the honour to represent my country and am able to show the delegation coming from 30+ countries that Cambodia is an emerging market. We are growing tremendously.

Disclaimer: Views are personal and not the views of the publisher.