Timor-Leste has declared itself open to Cambodian investment in several key sectors at the inaugural Cambodia – Timor-Leste Business forum featuring keynote speeches from senior ministers and a private sector panel discussion.
Held on Friday 21st October at the Sofitel Hotel in Phnom Penh the all-day event focused on two key areas, collaboration in tourism and in developing trade between the nations, the former of which you can read about below.
Speaking directly to the forum the Timor-Leste Minister of Tourism, Trade and Industry Arcanjo Da Silva stated: “The main factors for investing in Timor-Leste are our business-friendly legal frameworks, young population, our ability to act as a gateway within the region, as well as tax incentives for those who choose to invest.”
Tax incentives work on a sliding scale, depending on where the investment is and in which sector, adding that aside from certain protected industries, such as the military almost all areas of the economy were open to foreign direct investment.
Sectors for investment in Timor-Leste
Specific areas for investment pointed out by the minister were in the aforementioned tourism, food and beverage, agriculture and infrastructure to name but a few.
Timor-Leste was also keen to explore Public Private Partnerships with the Cambodian private sector with the minister stating: “We invite Cambodian business to partner with the Timor-Leste government on affordable housing, which is a key government priority and something Cambodia has been successful in achieving”
Other areas where PPPs were being sought were in the healthcare arena, as well as with Dili Airport. Timor-Leste plans to turn the airport into an international hub by 2035. This area, in particular, will need high levels of investment and cooperation with the airport currently serving just three routes, Singapore, Bali (Indonesia), and Darwin (Australia).
Another key part of the Timorese presentation was with regard to their resources and expertise with natural resources. Timor-Leste boasts huge reserves of oil and gas, which has led it to accumulate a Sovereign Wealth Fund estimated to be worth around $19 billion as of 2022.
As well as potentially offering energy security for the region, it could also offer other opportunities as the country seeks to diversify, such as in the Carbon Capture Storage market of which the country is aiming to be a leader within the region.
The minister added: “Through investment, this is a market that we can not only dominate within ASEAN but also service other countries in the region, such as China, Japan, and South Korea. Aside from the economic benefits, this will also help us and others within the region hit our net zero goals”.
Of course when it came to trade Cambodia was also open to inward investment and cooperation with the Ministry of Commerce showcasing how the new law on investment would benefit Timorese investors, but also how Timor-Leste would benefit from Cambodia’s free trade agreement network.
Cambodia has signed FTAs with South Korea and the People’s Republic of China within the last two years.
Inviting Timorese investment to Cambodia
Before the event on October 20, Cambodian and Timorese officials signed two documents to boost trade, an air services agreement (ASA), and a memorandum of understanding (MoU) on the rice trade at a ceremony at the Peace Palace attended by Prime Minister Hun Sen and President Dr Jose Ramos-Horta.
President Ramos-Horta has previously stressed his hopes for a direct flight route between the two nations, as well as his interest in not only utilizing Cambodian farming expertise.
The forum also featured a dialogue between numerous guests from the private sector discussing not only how to push forward ties between the two countries, but also how Timor-Leste could market itself to investors.
Allen Dodgson Tan Group Vice President at Worldbridge said: “When trying to get the investment it is about selling the country first and the investment second. This also means acknowledging the bad, as well as the good that your country has to offer and addressing both. This at least would be the lesson we would give from Cambodia”.
The event concluded with a gala dinner and a speech by H.E Ermenegildo Kupa Lopes, Ambassador to Cambodia for Timor-Leste, who declared the event a huge success as well as his hopes that it would be the start of deeper bilateral relations between the two regional allies, ideally as part of ASEAN.