1. High Value Silk Component Cambodia Export Diversification and Expansion Program (CEDEP) I Project performance: February to July 2014 By: Sylvie Bétemps Cochin, Trade Promotion Officer, ITC Date: 27 August 2014

2. Silk Component at a glance Objectives: To enhance the competitiveness of the silk sector and to increase exports of high value silk products with a beneficial impact on poverty reduction and employment, particularly among women Main beneficiaries: Silk businesses Duration: October 2012 - October 2015 Budget: USD 1,004,347 Funding: EIF Tier 2 Main Implementing Entity: ITC with a Project Coordination Unit (PCU) based at the Ministry of Commerce 2

3. Results and key milestones achieved 3 Coordination and management SCSC held its third meeting in February 2014 Work plan for Year 2 including budget planning endorsed by the SCSC Regular progress and financial reports submitted Materials and inputs provided for CEDEP I communication (newsletters), monitoring, preparation of the program mid-term evaluation Participation and contributions to Trade SWAp meetings, CTIS launch, EIF and TFM missions Representatives from the MoC and CEDEP M&E expert participated in project activities Set of project communication tools regularly updated, press releases produced, increased number of visitors on the project website and Facebook page

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5. Results and key milestones achieved 5 Outcome 1. Market Development Market information and intelligence collected and disseminated Market opportunity reports produced and buyers identified for EU, Japan, Korea and US markets. Market research ongoing on the Australian market Information collected used for company trainings, preparation of trade fairs, and reports disseminated to companies

6. Results and key milestones achieved 6 Outcome 1. Market Development (continuation) Export markets: Training and coaching 41 representatives - 36 women - from 20 silk companies trained on customer relationship management, order handling, trade fair preparation and follow-up 11 companies developed export plans and implementation ongoing; 1 company is developing its plan with project coaching support Companies’ marketing materials improved (brands, logos, catalogues, flyers, websites, product photo shooting) Constant coaching of the 14 project target beneficiary companies Collaboration with DHL and support for CoO

7. Results and key milestones achieved 7 Outcome 1. Market Development (continuation) Export markets: Buyers’ identification + 100 buyers prospected in Europe, +130 in the US and +100 in Japan, product samples produced and sent to selected buyers Buyers’ visits to exporters facilitated: -Vietnamese retailer: visited 9 companies, placed US$ 3,000 orders, long-term relationship established with the development of 12 customized product lines with 5 companies -Visit of the second largest German fair trade wholesaler EL PUENTE to 3 project beneficiary companies with high potential for long-term partnership

8. Results and key milestones achieved 8 Outcome 1. Market Development (continuation) Export markets: Trade fairs Participation in 6 trade fairs since the project outset and participation in 4 fairs planned between mid-2014 and Feb. 2015 Increased companies’ sales : + US$ 142,000 for 4 companies + 40% for one company; + 50% for another + US$ 35,000 for one company, + US$ 20,000 for another

9. 9 Case story Ambiente Trade Fair, February 2014 Marketing and preparation prior to the fair, coaching support during and after the fair Co-sponsored with SIPPO 4 companies Confirmed orders: $ 65,424 with 11 buyers Expected after trade fair: $ 44,680 – concluded after the fair: $ 77,000 20-30 buyers met by each company New product collections Long-term partnerships initiated with leading European fair trade wholesalers

10. 10 Case story New York NOW Trade Fair, August 2014 Marketing and preparation prior to the fair, coaching support during and after the fair 7 companies Total sales: $ 14, 209 USD Expected sales after the fair: $ 102,427 Average of 20 buyers met by each company + 3 large distributors New product collections and study tour “I met many retailers who bought product samples … I also learned about high-end fashion from the study tour”

11. Results and key milestones achieved 11 Outcome 1. Market Development (continuation) Tourism market 3 companies improved and 8 received advisory coaching support to develop their existing showrooms/retail shops, one is opening its own new sale outlet in Phnom Penh One company already reported an increase of 30% in its sales and another one increased its sales from US$ 500 to US$ 3,500 per month since showroom improvements and project start

12. Results and key milestones achieved 12 Outcome 2. Product Development Product innovation and design development 42 representatives - 36 women - from 19 companies trained on collection elaboration, products’ blue print and visual merchandizing Corporate brand images and product swatch books (each with 2 to 4 product lines) developed for 10 companies; 2 companies are developing theirs with project support 13 Cambodian silk companies received coaching support to develop new product collections in line with market requirements 113 new product designs developed for 10 companies

13. Results and key milestones achieved 13 Outcome 2. Product Development (continuation) Product quality: Training on weaving and dyeing, facilitate linkages between exporters and weavers 29 persons from 13 companies, incl. marketing and sales managers, designers, middlemen and weavers trained on synthetic dye (AZO free) and natural dye 17 representatives from 11 companies met with 23 weavers groups and visited 3 weaving centres during 2 study tours to weavers’ villages in 5 Cambodian provinces. Each company identified on average 5 to 6 new weavers’ groups. 6 companies already added more than 8 weavers’ groups to their existing networks of producers

14. Results and key milestones achieved 14 Outcome 2. Product Development (continuation) Product quality: Sourcing of quality silk yarn Business contacts established with 7 silk yarn suppliers. Visit of a Vietnamese silk yarn supplier to Cambodia facilitated, yarn tested, companies purchased 20 kilos of quality yarn Inputs to the Federation of Associations for SMEs of Cambodia (FASMEC) Working Group Manufacturing and Small and Medium Enterprises which resulted in the announcement by the Ministry of Economy and Finance of a VAT exemption for import of silk yarn until 2015

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16. Results and key milestones achieved 16 Outcome 3. Sector Coordination and Strategy Legal advisor recruited under the project produced the royal decree and sub-decree and reviewed them as a result of the discussions held during the third SCSC and subsequent comments received Variance

17. Follow-up to the recommendations of the SCSC during its previous meetings 17 RecommendationsStatus Encourage the participation of project beneficiaries in SCSC meetings Participation of project beneficiaries in all SCSC meetings; Presentations by project beneficiaries during SCSC meetings Develop project communication to disseminate information on activities and achievements Set of communication tools developed, updated, along project communication strategy Information and good practices collected throughout project implementation to be widely disseminated All 30 identified Cambodian silk businesses which responded to the assessment/baseline survey systematically invited to all group trainings and their requests addressed Information about project activities disseminated through the project website and Facebook page Documents and surveys disseminated via email to the Cambodian silk businesses which responded to the assessment/baseline survey All information shared and explained during trainings and coaching activities Dissemination workshop scheduled end 2014

18. Follow-up to the recommendations of the SCSC during its previous meetings 18 RecommendationsStatus Explore synergies with trade promotion activities conducted by MoC/Trade Promotion Department (TPD) Exchange of information ongoing with the newly created General Department of Trade Promotion of the MoC Establish the Silk Component Core Team as soon as possible On-going - Led by MoC Establish the National Silk Board as soon as possible. Progress made to be assessed and recommendations for mitigation actions formulated mid-2014 To be discussed at this meeting

19. Discussion Review project performance Provide recommendations for the establishment of the National Silk Board and its Secretariat, review the proposed options for mitigation actions and alternatives, and take a decision on the way forward Provide recommendations for the sustainability of project results, synergies with other government or donor-led initiatives, dissemination of programme results 19

20. Variance 20 Outcome 3. Sector Coordination and Strategy The NSB has not yet been created This process will take several months The sector strategy activities with the NSB (project outputs 3.2 and 3.3) should have kicked-started in Q3-2013 as per the project document and workplan These activities require min. 12 months to be completed and achieve the expected results CEDEP I/High Value Silk project will end on 30 September 2015

21. Mitigation 21 Outcome 3. Sector Coordination and Strategy During its third meeting, the SCSC recommended that the progress made in the establishment of the NSB be reviewed mid-2014, and that a practical approach should be recommended to mitigate the risks identified 3 practical options are put forward as mitigation actions and alternatives, for consideration by the MoC and the project Steering Committee

22. 3 options 22 Outcome 3. Sector Coordination and Strategy Option 1: Extend CEDEP I/High Value Silk Project duration Option 2: Re-allocate the resources earmarked for support to the silk sector strategy update (project outcome 3) to reinforce other project components (outcomes 1 and 2) Option 3: Reinforce the capacities of an already existing body or institution in Cambodia under project outcome 3, that could replicate and support the NSB once created