SCG plans to raise [cement] output in Cambodia

$200m set aside for cement subsidiary

Monday September 01, 2008
NAREERAT WIRIYAPONG
Bangkok Post

PHNOM PENH : Siam Cement Group (SCG), Thailand's largest industrial conglomerate, is planning to invest $200 million to more than double the capacity of its cement factory in southern Cambodia.

Kampot Cement Co Ltd, a joint venture in which SCG holds 93% and a Cambodian partner the rest, aims to lift its annual capacity to three million tonnes by 2010 from the current one million, according to the Thai embassy in Phnom Penh.

So far, SCG has invested $127 million in the facility located 148 kilometres southwest of Phnom Penh and within driving distance of the Cambodia-Vietnam border.

''The increase is to purely serve the domestic Cambodian market where demand for cement has risen sharply from ongoing construction projects. The property sector is also booming here,'' a high-ranking embassy official said.

Cambodia still imports cement from neighbouring countries including Thailand. But given the current high oil prices that have pushed up transport costs, local cement producers would gain more competitive advantages.

''Consequently, the expansion at Kampot has become more feasible for the time being,'' the official said.

SCG's Thai headquarters declined to confirm the expansion plan, saying the project had been studied.

According to the embassy, construction materials are the main items Cambodia import from Thailand, along with sugar and farm and consumer products.

Thailand last year recorded a 70% rise in exports to Cambodia with a total value of $1.4 billion. The figure does not include about 30 billion baht in cross-border trade.

According to SCT Co Ltd, an international trading arm of SCG, Thailand ranks third among the trading partners of Cambodia after Vietnam and China.

On the investment side, Thailand has yet to play an active role in Cambodia with South Korea, China and Malaysia taking the lead. Apart from SCG, major Thai businesses operating in Cambodia are Charoen Pokphand (CP), as well as are Siam Commercial Bank and Krung Thai Bank.

The Cambodian government provides incentives for foreign investors such as tax-free machinery imports and corporate income tax holidays. It also promotes Special Economic Zones that comprises an export free zone, container yard area and other facilities for industrial zones.

The Thailand-funded road Number 48 in Koh Kong is expected to facilitate more business links between the two countries by strategically turning Koh Kong into the gateway to Phnom Penh.

Siam Cement shares (SCC) closed on Friday on the Stock Exchange of Thailand at 165 baht, up one baht, in trade worth 65 million baht.

Truth behind the hoopla: Kampot Cement is 90% owned by Siam Cement Group

Left: Hun Sen and VIPs touring the cement plant, Right: View of the plant (Photo: CPP)

SIAM CEMENT GROUP: Cambodia plant starts up

Saturday January 19, 2008
POST REPORTERS
Bangkok Post

Siam Cement Group's joint-venture cement plant in Cambodia officially started operations yesterday to tap rapid demand growth in Thailand's neighbour.

Kampot Cement (KCC), is a 90:10 joint venture between SCG and the Khaou Chuly Group, Cambodia's leading construction and engineering firm.

The joint venture company was established with investment capital of US$100 million, or 3.2 billion baht, and can produce 900,000 tonnes of Portland cement a year, according to SCG cement president Pramote Techasupatkul.

Output from the Kampot plant mainly served domestic consumption. Demand in Cambodia has grown faster than supply.

''Our additional capacity will lower the country's dependence on imported cement, which will reduce its trade deficit,'' Mr Pramote added.

The company also aims to see its production technology transferred to local operators through its contractor training programme.

SCG hopes to become a leader in Asean with heavy investments in pulp and paper, petrochemicals and cement.

Apart from Kampot, SCG's other investments in Cambodia include Cpac Cambodia, a ready-mix cement business; Cpac concrete products; Cpac Monier roofing tile products; and engine parts and lube oil from Siam Kubota Industry.

Hun Sen cautions on explosives used at the newly opened cement factory - 1997 Explosions still bring bad memories to Hun Sen?

Hun Sen Urges Caution on Explosives

By Chun Sakada, VOA Khmer
Original report from Phnom Penh
14 January 2008

Prime Minister Hun Sen warned on Monday that terrorists could find their way to explosives from a newly opened cement factory if vigilance lapses.

Speaking at the opening of the $90-million factory in Kampot province, Hun Sen said terrorists needed explosives like those housed at the factory.

“The control of explosives must be carried out neatly, according to regulations,” he said.

His comments follow statements made by Cambodia’s national police chief that counterterrorism work with the FBI has been productive.

Cambodia has in recent years become a willing partner to the US in its counterterrorism efforts.

There are no known terrorist threats in Cambodia, although in 2003 it was discovered that a senior leader of the Islamic fundamentalist group Jemaah Islamiya had taken refuge in Cambodia before traveling to Thailand.

Cambodia opens first big cement plant [-It's not 100% Cambodian-owned though]

KAMPOT, Cambodia, Jan 14 (Reuters) - Cambodia's first major cement plant, a $93 million joint venture with Thailand's Siam Cement SCC.BK, opened on Monday, another symbol of the war-scarred southeast Asian's nation rapid economic development.

The factory, in the coastal province of Kampot, is expected to produce 960,000 tonnes of cement this year, reducing Cambodia's reliance on imported materials for the construction boom reshaping its capital, Phnom Penh.

Siam Cement and top Cambodian building firm Khaou Chuly Group said their joint venture, Kampot Cement Co., should be producing double that quantity in 2009 and 2010.

At the factory's opening ceremony, Prime Minister Hun Sen said Cambodia had been importing between two and five million tonnes of cement each year to meet soaring demand and needed to start making its own.

"We need more cement," he said.

After decades of civil war, including the Khmer Rouge "Killing Fields" of the 1970s, Cambodia's economy has taken off in the last three years, due mainly to rapid expansion of its tourism and garment industries.

A construction boom fuelled by billions of dollars of foreign investment, much of it South Korean, has helped push annual economic growth to nearly 10 percent.

(Reporting by Dara Rith; Writing by Ek Madra; Editing by Ed Cropley)