Thursday, October 14, 2010

Moving to Cambodia

Although quite a bit has been happening on both the political and economic front in the past two months I have not been able to maintain this blog for some time. I have given up my U. S. residence for good now (although I still have my business and own property there). I also moved into new homes in Phnom Penh and in Sihanouk province, which kept me busy for the last two to three months. I had lived in a furnished 2-bedroom apartment in Phnom Penh and a weekend cottage before.

I think I will have a little more time to furnish some inside info on Cambodia again in the future. First, however, let me tell those overseas Khmer considering moving back to Cambodia lock, stock, and barrel what is involved in such a move; financially, cutting through red tape, setting up or building your own home, etc.

In the past I have always encouraged overseas Khmer to move back in order to help develop the country. We all know Cambodia is still in dire need of people with a better education, know-how in modern business, experts in various fields ranging from agriculture, mid-sized construction, to small manufacturing, knowledge of international trade, and teachers, among others.

From my many encounters with Cambodians overseas I know they all long to be back in their home-country but really don’t know what to do here; whether they can afford the same things they are used to in their adopted countries, maintain the same life-style, etc. It certainly is a big decision. I am aware that most overseas Khmer just make enough to make ends meet; not a whole lot have struck it ‘rich’ overseas; they just have normal jobs; many times they barely eke out a living, oftentimes due to the lack of proficient knowledge of English, French, or German; the languages of the countries that most of them went to. Of course, their children who were born overseas don’t harbor those feelings. They more or less assimilated into the new culture and feel as belonging there rather than here. But nevertheless, I would still recommend the younger people as well to at least consider it; the money might not be as good here, in fact, it definitely isn’t, but possibly it might be more rewarding in other respects.

However, once they are ready to go ahead with their plans they may be surprised how much it actually costs to make that actual move if you want to take your whole belongings with you.

Now I had furniture for a 4-bedroom house, one SUV, one motorcycle, one 22’ power boat. My residence was Florida, which is almost exactly halfway around the world from Cambodia, so the cost is higher than from California, or Europe for that matter.

First, I forgot about the power boat. It would have cost $15,000 for the freight alone; I had checked into how much the import duty would have been, but boats weren’t in the books of the customs department. Anyway, that was too much for my taste so I simply sold the boat.

Next, I wanted to take my SUV, a 2001 MB ML320, and my motorbike, a 2003 Honda 750 Shadow ACE. Put into a container the freight would have been $5,500 for both; import duty for the MB around $11,000, and $1,100 for the motorcycle.

The lowest quote I got for the furniture, another 40’-container, was $9,300 including insurance, so altogether I was looking at around $26,000 to $27,000 just for freight and duty. My freight agent in Phnom Penh also advised me that there would be some import duty on the personal belongings, e. g. TV, computer, and such. All of a sudden that added up to possibly over $30,000.

Consequently, I scratched the car and the motorbike. I sold both which paid for the freight for the furniture. That made it a lot more acceptable. Additionally, I had an SUV in Cambodia already. We needed to add the flight tickets for the family into our tally, which set us back another $6,000 (not to mention the trip to Washington, D.C. and New York my wife and I took as a farewell tour, which slimmed our pocket books by another $4,000; but after the hassle of packing things and getting the house ready for sale we thought we had earned that trip).

When we got to Cambodia we moved right into the house in Phnom Penh my wife’s uncle and aunt had prepared for us already; additionally two of our kids had arrived a month earlier, so we didn’t have to do much on that end. Nevertheless the house needed to be furnished, we needed motorbikes for the kids to get around, etc. – cost for fridge, TV, furniture, curtains, and so on, $7,000. The furniture from our house in the U. S. was to go to our house in Sihanouk province.

That container was still on the water and it took a month until it arrived in Sihanoukville port. Total transit time from the house in Florida to Cambodia was 51 days. While we were waiting we prepared all the paperwork for the import clearance. Besides the ocean bill of lading, the Cambodian customs department requires a commercial invoice (never mind that this was a personal move), and an itemized inventory of each item. Virtually everyone in the U. S. owns some kind of gun; so did I. I wanted to take them but those were definitely no-go items. I tried for a special permit but was categorically turned down; so sold they were too.

Of course, now the haggling started over whether or not there was any import duty payable. I left that in the hands of my freight agent. To my vast relief he reported to me on the day the container was finally cleared that we were exempted as the whole affair was declared as my wife’s return to Cambodia. Nevertheless, we still needed to part with a whopping $1,350, which broke down into fees for the port, Camcontrol (the official inspection agency), import permits, clearance fees, fees for documents, approval fees, x-ray inspection fees (each container is x-rayed, so forget about trying to smuggle in something illegal, e. g. weapons, drugs, etc.), warehousing, and transportation. In comparison to clear an inbound container in the U. S. is around $60 in agent’s fees, but the terminal handling charges are about $500; anyway, it is still way cheaper in the U. S. (I know; I have owned an import business there for 20 years).

If you do the math you get a neat $25,000 plus miscellaneous out-of-pocket expenses to make that move for a family of 4. (I had gotten rid of at least one quarter of our furniture in the U.S.) Obviously only few people will move into two homes at the same time, so take off the $7,000 for house in Phnom Penh. But $18,000 plus will still make you think twice. You may deduct about $2,000 if you move from California, and $3,000 if you move from Europe. Fewer belongings won’t make a big difference as a 20’-container is about $300 less than a 40’er. The only consideration might be to sell off your stuff and start from scratch in Cambodia. If you want to maintain a Western standard it will cost you at least $15,000 too to buy everything from fridge to sofa, chairs, etc.; and it is a question of quality too.

Is it really worth making that move? It all depends on your motivation for it. Mine was pretty clear; I have a Cambodian wife, and two Cambodian children who still live at home; I firmly believed the children should go back to make their contribution to Cambodia, as small as it may be. Others might think differently; in fact, I guess most of them do.

Most serious Westerners, of course, come to live here from world-weariness, that is, weariness of our Western - what I perceive as - degeneration. It is slowly finding its way into Cambodia too, judging by what young Khmer people consider ‘in’ in terms of life style and what’s important to them. It also used to be that Westerners came here for the low cost of living. That may turn out to be a fallacy. If you live and eat like a Khmer, yes, but if you continue with your Western life-style, there is hardly any difference any more, except for eating out, rent (if you rent), medical costs, clothes. Anyway, this is the second time that I have come here to live here full-time, so there is at least one person who thought it worth it.

6 comments:

Anonymous said...

From what I know, Hun Sen has every friendly policy toward Khmer Oversea. Cambodian Americans can get a life time Visa to travel to Cambodia as they’re desired at no cost. Cambodian Americans who were born in Cambodia can visit any historical places such as Angkor Wat and don’t have pay. Cambodian Americans who decide to return to live in Cambodia can own land. Cambodian Americans who are living in Cambodia are citizens of Cambodia. I know so many of them have good businesses in Cambodia such as Hotels, and I know that so many of them are working and supporting Cambodia People Party, not just in Cambodia but also in the U. S. as well. I do not think that they need your help.

KJE said...

11:19
Who said anything about help? I just wanted to give an overview of the cost.
Nobody disputes any of the things you mention. But this is what every country offers to their citizens, as long as they retain their nationality. So this is not something particular to the Cambodian government or to be considered especially generous. You must have misunderstood my post.

dk said...

Well I definately appreciate the cost overview. I didn't think it would cost over 20k that's a big chunk for me. I was thinking of living there for a few years nothing permanent. All I really want to bring with me are my electronics. You know computer, TV, media player, and console video games. do you know a good source for finding out the types of fees and their amounts to bring such things over?

KJE said...

DK
20K is for a complete household move. What you need is much smaller and will cost much less. Check out this website: www.shipping-worldwide.com

dk said...

thanks, but I would thinking more of the cambodian fee and cost. For example what kind of duty tax and such should I be expecting for my electronics and how the heck are they calculating the tax on these items. Most of my items I've had for over 2 years would they tax on the retail value of these items? what about my PC I built it myself how are they going to determine it's value? Especially when my PC would normally retail around $1000 but I spent $500 to build it.

KJE said...

DK,

If you have a business visa, you can declare these things as household items; if customs see that you don't import 10 TV sets, etc., they'll treat it as a move. The fees are in the range of $300 to $500 depending on the value of the items. The freight agent usually charges a flat $150, the customs people around $200. Check with CamFreight in Phnom Penh. They have a website and you send an email through there.

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