Cambodia Reports Strong Business Growth

July 15, 2014 Posted by ASEAN Briefing Reading Time: 3 minutes

Cambodia’s capital city, Phnom Penh, is now home to the country’s first international mall. The Aeon Mall, established by Japanese retail giant Aeon Group, is the first such mall located in the country, according to Prime Minister Hun Sen.

PM Sen celebrated the mall’s opening earlier this month, noting that the “investment by Aeon Group is a key message highlighting the economic potentials of Cambodia reflected through noticeable enhancement of living standard of Cambodians, especially the growing number of middle-class families.”

This optimistic view has also been echoed by statistics released last month by the Ministry of Commerce in Cambodia. According to the Ministry, the total number of newly registered businesses increased from 1,401 to 1,868 between January 1 and June 15 this year. This is a 33 percent increase over the prior year. Of those, 654 were foreign-owned companies originating from Thailand, Malaysia, China, South Korea and Japan.

According to the PM, Cambodia registered US$4.9 billion in foreign direct investments (FDI) in 2013, an increase of US$2 billion from 2012. These investments have gone into a variety of sectors, including medical equipment, motor and electrical tool manufacturing, as well as manufacturing of garments and footwear. The tourism industry in Cambodia is also on the rise owing to an increasing number of foreign visitors.

“Foreign businesspeople are more interested in the general business environment in Cambodia even though the political situation is not yet stable,” spokesperson for the Ministry of Commerce Ken Ratha told the Cambodia Daily.

Ratha attributed the increase in foreign investment and newly registered businesses to government policies that promote foreign investment. For example, in 2012, the Cambodian government established the Council for the Development of Cambodia to oversee investments in the public and private sector.

The Cambodian Special Economic Zone Board (CSEZB) has also been created to deal with investment projects within the Special Economic Zones (SEZs) in the country. Currently, Cambodia has 29 SEZs which include favorable tax policies for foreign investors.

Asia Briefing Ltd. is a subsidiary of Dezan Shira & Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information, please email asean@dezshira.com or visit www.dezshira.com.

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