With the dawn of January 1, the free trade agreement signed by China and Cambodia has come into effect and will see the granting of zero tariffs to up to 90% of its imports from China and duty-free granted to some 98% of imports from Cambodia. The growth in bilateral trade between Cambodia and China has been growing steadily for the last two decades, from US$ 0.27 billion in 2002 to over 9 billion in 2019, and despite the pandemic, the target of US$ 10, which was originally set for 2023, was exceeded this past year according to China’s Ministry of Commerce reaching US$10.98 billion. Although many tariffs on Cambodian exports to China have already been removed through the ASEAN-China Free Trade Agreement, or ACFTA, the China-Cambodia Free Trade Agreement (CCFTA) is expected to benefit important agricultural exports to China, such as milled rice, cassava, garlic, cashew nuts, as well as bananas and fresh mangoes which have already been enjoying a rise in exports thanks to the certification by Chinese customs. China’s exports to Cambodia are textiles important for the garment industry, steel, electronic devices, metal machinery and building materials, also very important for the growing electronic and car industry in Cambodia. China’s imports from Cambodia include much-needed raw materials such as rubber, wood, and produce such as plywood, panels and furniture. The implications of the agreement are also part of a general shift for Cambodia in terms of which industries are expected to develop and which countries it will see a growth in trade with. Last year the US was Cambodia’s top destination for its exports, and as the Vice president of the Chamber of Commerce, Lim Heng, Cambodia can also capitalise on its proximity to China and its favourable access to the Chinese market for American companies who wish to sell their products in China. “America is having problems trading with China at the moment and this can be advantageous for Cambodia where American car manufacturers and producers of electronics goods can establish themselves for selling their produce in China. Not only the US but also other countries such as the Republic of Korea and Japan will see Cambodia as an attractive destination for investing in production,†he explained. Such foreign investments, due to bilateral agreements like the CCFTA, are also expected to bring about an enhancement in skills in the labour market and technology transfer in Cambodia according to the strategic advisory firm, Bower Group Asia. Also, thanks to the free trade agreement with China there is expected to be more investments from China with the development of the belt and road, as well as cooperation in e-commerce and trade in services, and according to China’s Ministry of Commerce further cooperation on infrastructure building and the development of the green and low carbon industry in Cambodia.