The Cambodian Chamber of Commerce (CCC) has set high expectations that in 2022, the growth of foreign investors wishing to invest in Cambodia will be surge than in 2021.
This expectation comes as the chamber claimed that Cambodia’s vaccinated population was close to achieving its goals across the country and the trade agreements with a number of major countries had entered into force.
Oknha Lim Heng, Vice President of the Cambodian Chamber of Commerce (CCC), told the Cambodia Investment Review that the chamber expects the flow of foreign investors to return to Cambodia in large numbers in this year.
“We still have high hopes as in 2021, because in the first two months of 2022, the Council for the Development of Cambodia (CDC) received investment from foreign investors totaling more than 2.4 billion US dollars. There are already more than 10,000 online registrations with the Ministry of Economy,” he said.
“I think this year is a good year for Cambodia to attract foreign investors, while in 2021, the presence of investors and traders will continue to invest in Cambodia without any signs of decline,” he added. “Although the Covid-19 crisis has been wreaking havoc on Cambodia’s socio-economy.”
According to data from the Council for the Development of Cambodia, in 2021, the CDC approved a total of 161 investment projects worth nearly $ 4 billion and created nearly 100,000 jobs.
To read more about Cambodia’s post COVID economic outlook click here.
However, for 2021, the total investment project approvals decreased by 77 projects compared to 238 investment projects in 2020. Of that, investment capital for 2021 was nearly $ 4 billion, down nearly half of the $ 8.2 billion invested in 2020.
In an exclusive interview between Cambodia Investment Review Lim Heng also raised the issue of the war between Russia and Ukraine. He said the war could not disrupt investment and the influx of foreign investors to Cambodia. He said that Cambodia has re-launched its economy and many sectors have resumed normal operations.
Based on Lim Heng, in 2022, Cambodia will be the most attractive place for investment from foreign investors. The point that investors can not overlook Cambodia is because this year, Cambodia must implement the free trade agreement between Cambodia-China and between Cambodia-Korea. There are also the RCEP (Regional Comprehensive Economic Partnership), the GSP (Europe and the US) and the EBA.
He added that Cambodia also has a stable geopolitical growth rate, vaccination in all areas, which is a point for and prominence in ensuring the well-being of people and investors. “These are the points that are important to attract investors to invest in Cambodia,” he said.
Developing Cambodia’s investment framework
Within the ASEAN framework, in 2022, Cambodia will be appointed as the rotating chair of ASEAN. The Cambodian Chamber of Commerce will also chair the ASEAN Business Forum with international chambers of commerce and foreign investors.
In that, Lim Heng told CIR that the role and plan of the Cambodian Chamber of Commerce this year is very important for Cambodia. He stated that the CCC will have a high opportunity to attract more foreign investors by promoting the economic potential in Cambodia.
The Vice President of the Chamber of Commerce said that the work direction of the Cambodian Chamber of Commerce in 2022 will be divided into two separate frameworks. The first framework is the implementation of work directions in the country and the second framework is the implementation of work directions with international partners.
“The framework within our country must disseminate laws, and other laws around investment in Cambodia, especially the new investment law. In addition to the government’s internal economic reform, the Cambodian Chamber of Commerce has also partnered with the General Department of Taxation and Customs to help resolve the difficulties posed by foreign investors and chambers of commerce as soon as possible.” he said.
“Separately, within the framework of working directions with international partners, we will continue to promote, explain, guide and attract more foreign investors. In particular, as the chair of the ASEAN Business Council, we will meet with foreign chambers of commerce to highlight the potential we have and to maximize their profits. These are the directions that the Cambodian Chamber of Commerce will be working on,” he added.
Please be informed that in 2021, the CCC has achieved many positive results. The positive effect is to attract foreign investors, provide them with a credible investment environment, as well as address the challenges that foreign chambers of commerce and foreign investors face.
To read more about Cambodia’s upcoming Law on Investment click here.
Lim Heng stated that in the context of Covid-19, the work results achieved by the Cambodian Chamber of Commerce are still better than 2020, although at that time CCC had to use the online system to meet with the private sector and business partners.
In 2021, the influx of Chinese investors ranked first among the largest foreign investors in Cambodia. This positive growth is also partly contributed by the Cambodian Chamber of Commerce in helping to disseminate to all foreign investors, according to the Cambodian Chamber of Commerce.
Lim Heng claims that in Cambodia, most foreign investors come to invest in industries such as garment factories, electronics factories, car parts, small and medium enterprises. He said that the potential sectors that investors should come to invest are industry, agriculture and real estate.
“What we need to do with foreign investors, the private sector and foreign chambers of commerce in 2022 is to deepen awareness of the new investment laws that the Cambodian government has enacted and the benefits they will receive after investing in the Cambodia,” Oknha Lim Heng said.
Trade agreements increase investment opportunities
Lim Heng stated that under the Free Trade Agreement between Cambodia-China and Cambodia-Korea, as well as the RCEP, GSP and EBA, it will make the Chamber of Commerce Cambodia has sufficient resources to provide information to all investors who are considering investing in Cambodia.
He said the CCC continues to encourage and seek solutions to the problems that investors face to discuss and propose to the government to resolve more quickly. This is to provide warmth to investors who come to invest in Cambodia.
“We do not leave investment partners in our country alone,” he said. We continue to provide information that the government is ready to implement. “We want them to understand the investment situation in Cambodia and the government’s new policies to provide them with more capital and knowledge to prevent any possible risks.” he added.
To read more about the investment opportunies for Cambodia under the Regional Comprehensive Economic Partnership click here.
In 2022, Cambodia has started a new economic census to collect data from national and international development partners. Oknha Lim Heng claimed that Cambodia will be able to attract more foreign investors by providing specific information to investors and business people to study the market in Cambodia before deciding to invest on their business.
“The economic census is important for developing countries and developed countries like Cambodia,” he said.
According to Lim Heng, the new investment law will be a sharp strategy to present opportunities in Cambodia to attract more quality investment. He added that the new investment law also provides an opportunity for local enterprises to be exempted from 10 percent (VAT).
“Previously, investors had to pay a 10 percent of tax when they ordered local raw materials to produce their materials and goods,” he said. This has forced them to buy raw materials from abroad to produce in Cambodia. “But the new law will make it easier for all investors without having to pay another 10 percent tax when they buy raw materials in Cambodia, especially exporting goods made in Cambodia,” he added.
“The new investment law also encourages more investors, as the government will not tax the private sector for three years and we will also facilitate investment and transportation as well,” he said
Sam Oudom is a Prince Foundation Young Business Journalist.