Cambodia Investment Review
The Securities and Exchange Regulator of Cambodia (SERC) has launched a comprehensive 10-year roadmap to transform the Kingdom’s capital market into a dynamic engine of national growth, aligning with global trends in digital finance and sustainability.
Released on July 16, the Securities Development Master Plan 2025–2035 lays out a strategy to diversify investment products, modernise regulatory frameworks, and attract more local and international investors to the Cambodia Securities Exchange (CSX). The initiative supports Cambodia’s broader development agenda, including its Vision 2050 strategy and the UN Sustainable Development Goals (SDGs).
Strategic Vision to Deepen the Market
At the heart of the plan is a vision to establish a capital market that is “orderly, transparent, vibrant, resilient, sustainable, and innovative.” The SERC aims to:
- Boost listings, including from state-owned enterprises (SOEs)
- Launch new instruments such as derivatives, commodities, and carbon credits
- Develop secondary markets for government bonds
- Expand collective investment schemes (CIS)
- Strengthen market infrastructure and investor protection
- Introduce a carbon credit trading platform to tap into ESG finance
The regulator also plans to implement advanced supervisory tools (RegTech and SupTech) and roll out mobile-based platforms to widen investor access and transparency.
Decade of Growth and a Call for Diversification
Cambodia’s capital market has made significant gains over the past 10 years. Equity market capitalisation jumped from $157.8 million in 2014 to $2.77 billion in 2024, with trade volumes increasing from 10 million to 219 million shares, according to the master plan.
Meanwhile, the bond market raised more than $258 million, and investor accounts climbed from just over 6,000 in 2014 to more than 57,500 in 2024. Derivatives trading, introduced in 2017, now posts annual volumes exceeding $300 million and involves over 11,600 trading accounts.
Yet challenges remain. Only 23 companies are currently listed on the CSX, with activity heavily concentrated in a few sectors. The plan acknowledges that despite recent growth, Cambodia’s market remains underdeveloped compared to regional peers like Vietnam and Thailand.
SWOT Analysis Highlights Cambodia’s Market Potential and Pitfalls
A detailed SWOT analysis within the master plan outlines strengths including political stability, a young and tech-savvy population, and high mobile internet penetration. Cambodia’s legal framework is also seen as broadly aligned with international standards.
But the report flags key weaknesses: limited domestic capital, low GDP per capita, gaps in financial literacy (particularly in rural areas), and a shortage of market professionals. The country’s reliance on the US dollar also poses currency mismatch risks.
Opportunities outlined in the plan include:
- Harnessing fintech and big data to increase market access
- Promoting green bonds and sustainable investment vehicles
- Strengthening links with ASEAN capital markets and initiatives like the Asian Bond Markets Initiative (ABMI)
- Supporting infrastructure financing through capital markets, including projects in the Logistics Master Plan 2023–2033
Among threats, SERC cited cybersecurity vulnerabilities, misinformation on digital platforms, and the need to expand the narrow investor base to include a broader segment of the population.
Policy Frameworks and Implementation Path
The master plan groups its strategy into three pillars:
- Securities Market Strengthening: Expanding products and services, growing the investor base, upgrading systems, and ensuring integrity.
- Securities Market Expansion: Modernising legal frameworks for sustainable finance and fintech while adopting RegTech for supervision.
- Supporting Market Development: Investing in talent development, data systems, public awareness, and international partnerships.
SERC also plans to embrace risk-based supervision and develop better investor education programs, especially via mobile platforms.
Strengthening Regional and Global Integration
The plan reflects Cambodia’s growing role in regional capital market integration. As former Chair of the ASEAN Capital Markets Forum (ACMF), Cambodia helped shape regional sustainability standards. In 2024, the country joined the Sustainable Banking and Finance Network (SBFN) and is working toward full membership in the International Organization of Securities Commissions (IOSCO).
These efforts are expected to enhance cross-border cooperation, improve regulatory standards, and build investor trust.
A Long-Term Vision for Frontier Market Growth
With a clear structure and focus areas, the Securities Development Master Plan 2025–2035 positions Cambodia to move from a frontier to an emerging market economy. If successfully implemented, the plan could deepen capital markets, improve long-term funding for infrastructure and sustainable growth, and establish Cambodia as a more attractive destination for regional and international capital.
