The government’s highest decision-making body for large-scale investments approved 52 projects in the third quarter (Q3) ended September 30, across a diverse spectrum of sectors, with total registered capital of $460.8 million, according to the latest economic and financial statistics bulletin.
Released by the Ministry of Economy and Finance, the bulletin indicates that the Council for the Development of Cambodia (CDC) greenlit five more projects than in the same three-month period last year, with total registered capital rising by 18.4 per cent from $389 million.
The ministry ascribed the increases to mounting investment in solar panel manufacturing, hospitals, vehicle assembly, and island development, as well as expansions in special economic zones (SEZ).
An SEZ is a specially-defined region within a jurisdiction’s borders that is subject to different – typically more liberal – economic regulations than elsewhere in the same jurisdiction.
It noted that global economic growth is steadily recovering, and predicted that Cambodia’s gross domestic product (GDP) would grow by 5.4 per cent this year, despite fallout from Covid-19 and the Ukraine crisis. This would mean a 2022 GDP of $28.4 billion, using the World Bank’s $26.961 billion figure for 2021 for reference.
Cambodia Chamber of Commerce vice-president Lim Heng told The Post that the CDC’s project approvals have been on a steady upward trajectory since the government in November 2021 moved to allow socio-economic activity to fully resume.
Heng credited this increase to strong economic growth, favourable changes to the legal investment framework, Cambodia’s attractive geographical location, abundant natural resources, a wealth of skilled workers, and improvements to the transportation system, as well as the country’s bilateral and multilateral free trade agreements (FTA) which he said have expanded the Kingdom’s export market.
He predicted that such investments will keep pouring in, “because, in addition to the favourable conditions inside Cambodia, there are also many large markets waiting to receive its goods”.
The Kingdom has also seen an uptick in investment from companies shifting operations away from countries that are currently experiencing political instability, wars, or trade disputes, Heng remarked.
Royal Academy of Cambodia economist Hong Vanak claimed that its favourable investment laws, coupled with its ample supply of skilled labour and export markets in large countries, have positioned the Kingdom as a “very attractive” investment destination.
“With all these favourable conditions, I am optimistic that the number of investment projects approved by the CDC will continue to increase, or at the very least not decrease,” he said.