Two large European companies working in the construction sector have announced plans to expand their distribution networks in Cambodia, according to a joint agreement signed last week.

Together with the Thai subsidiary of French building-materials giant Saint-Gobain, the France-based electrical installation multinational Schneider Electric signed a joint cooperation agreement with Cambodian company Camstar on March 31.

The companies are banking on Cambodian construction materials firm ISI Group – Camstar’s parent company – to connect them to a nationwide distribution network of over 300 outlets and more than 100 contractors.

Thai Gypsum Products, which manufactures gypsum used in plasterboards for Saint-Gobain’s Thai operations, said it saw a “big opportunity” to expand its networks for gypsum delivery in Cambodia ahead of the upcoming ASEAN economic community due at the end of the year, according to a statement.

“Thailand has been our strong establishment as well as a center of goods distribution to neighboring countries,” said managing director Richard Juggery.

“Now we see a good potential of Cambodia as the country has attracted more foreign investors and performed outstanding business growth in past few year,” he added.

Saint-Gobain describes itself as the largest construction materials company in the world, while Schneider Electric is one of Europe’s largest electricity installation companies.

More international construction companies are expected to enter Cambodia’s building sector, said Koon San Ang, the president of Schneider Electric in Cambodia, adding that Schneider signed the agreement bolstering its local networks to stay a step ahead of the game.

“For Schneider Electric to follow on these developments and keep a close proximity with existing and potential customers, we strongly believe in extending our partnership to increase and strengthen our local presence in Cambodia,” he said.

Construction projects approved in Cambodia stood at $2.5 billion last year, according to the Ministry of Land Management, Urban Planning, and Construction, a 10 per cent decrease from last year.