Australia’s Department of Foreign Affairs and Trade (DFAT) is aiming to increase the amount of investment into Cambodia by hosting a roundtable discussion with Australian investors and Cambodian government officials.
The roundtable was organized by TradeWorthy Director Sven Callebaut and co-chaired by H.E. Nut Unvoanra, Deputy Secretary General of the Cambodian Investment Board, Australian Deputy Ambassador to Cambodia Andreas Zurbrugg, representatives from the Cambodian Government and leading Australian investors.
The discussion centered on addressing both the challenges and opportunities faced by Australian investing in Cambodia as well as the barriers of convincing investor to bring in capital and fund new business ventures.
Opening the event Andreas Zurbrugg set the tone for the discussion remarking, “Foreign Direct Investment is like water, it follows the path of least resistance”.
H.E. Nut Unvoanra added that listening to investors especially those already established in Cambodia was a key priority of the CBC to ensure it had the levers right to attract more quality investment from destination such as Australia.
Event moderator Sven Callebaut spoke of the more than $41 billion in Foreign Direct Investment into Cambodia since 1994 reflecting that while Australia had been a leading development assistance partner – the country had very low FDI levels.
To read more about the FDI in Cambodia since 1994 click here.
The Australian investors who spoke at the roundtable included:
- Acclime (investment advisory) Hugh Darwell
- ALS Cambodia (laboratories) Bob Gordon
- DFDL (investment advisory) Chris Robinson
- CIR Media (media and communications) Harrison White
- Dynamic Group Multi (tech, agro, energy) Kenneth Tang (Auscham Cambodia Chairman)
- Lexmin Pty Ltd Cambodia Agriculture Robert K. Chelliah
- GEI Cambodia Waste Management Sector William Willis
- IDP Services (education) Ashley Irving
- Renaissance Minerals Ltd / EMERALD Mining Brett Dunnachie
- Mekong Strategic Partners Services (investment advisory) Stephen Higgins
Rebecca Ball, Senior Trade Commissioner for Vietnam and Cambodia with the Australian Trade and Investment Commission was also involved in the discussion highlighting the need to better promote Cambodia and the Mekong region to Australia.
Challenges of doing business in Cambodia for Australians
Speaking about the challenges faced by Australian’s doing business in Cambodia two common themes repeated was of the need for Cambodian ministries to reduce repetitive paperwork and to better unify the ministries through its single portal application.
To read more about Cambodia’s single portal business registration click here.
Hugh Darwell from the business advisory firm Acclime reflected on the burdensome requirements of wet signatures – especially for directors outside of Cambodia – as well as inconsistent interpretation of some registration requirements.
In response, the Ministry of Commerce representatives acknowledged the concerns of wet signatures and indicated they were open to methods of accepting e-signatures, as long as a robust verification process could be adopted.
Ashley Irving from education provider ACE highlighted the need for properly skilling Cambodian staff and addressed the common misconception of Cambodian workers being ‘lazy’ as completely untrue.
Changing perceptions and strengthening dispute resolutions
The roundtable also focused on the need for government agencies to better promote investment opportunities in Cambodia to Australian investors by providing up-to-date data and investor news as well as hosting more trade tours.
Harrison White Founder and CEO of media and communications firm CIR Media suggested government agencies invest more in data and up-to-date business and investment news to distribute to potential investors.
“Many Australian’s are unaware of the fantastic opportunities there are in Cambodia – and the Mekong region more broadly – due to the lack of freely and easily available information in the market,” he said.
Stephen Higgins the Founder and Managing Partner of investment advisory firm Mekong Strategic Partners noted the common practice of companies using Singaporean legal jurisdiction for business contracts.
“Many investors prefer using contracts based under Singapore’s legal system due to perceived independence issues of Cambodian courts. One solution could be to establish international judges to sit on a commercial court for business disputes – similar to initiatives Hong Kong has implemented,” Higgins said.
According to DFAT total two-way goods trade with Cambodia in 2020 was valued at $432.4 million, up 21.6 per cent on 2019. Australian total goods exports to Cambodia in 2020 was valued at $121.4 million, up 43.5 per cent on 2019.
Australia’s existing commercial interests are focused in education services, food and beverage, financial services, mining and resources, hospitality and garment sourcing.