APPROVED investments were down 25 percent last month on a year earlier, figures by the Council for the Development of Cambodia (CDC) showed Monday, as tourism investment continued to suffer.
Data showed that US$75 million in investments were approved in January, down from $100 million the previous year when the tourism sector accounted for $89 million in projects. Last month no tourism projects were approved, CDC figures showed.
“We are still optimistic that the value of investment will increase this year as the world economy – which has been in crisis for a few years now – shows positive signs of recovery,” Duy Thouv, the CDC’s deputy director general, said Monday.
The figures were just temporary, he said, adding that the situation will likely improve.
Monday’s data were particularly discouraging given the very low base achieved last year. Approved investment dropped a huge 46.18 percent last year as the tourism sector in particular saw the influx of new capital grind to a halt – tourism projects passed by the CDC plummeted $5 billion last year, official figures showed.
Despite the drop in the value of projects approved last month and the complete absence of tourism developments, there was some good news for the stuttering economy.
The CDC said it passed nine projects last month, compared to just four a year earlier, and there further signs that Cambodia’s agricultural sector – the largest in the country and the best performer last year in terms of growth, according to 2009 projections – was receiving a more capital.
In January 2009 the CDC did not approve a single dollar in agriculture investment. However, three projects worth $38.85 million were given the green light last month, representing just over half the total approvals. A further $4.28 million investment in food processing was also approved, CDC figures showed. In January last year, the CDC approved a food processing investment worth $8.47 million.
“Paying attention to the agricultural sector through investment activities can be advantageous for … economic growth in a developing country like Cambodia,” said Kang Chandararoth, president of the Cambodia Institute of Development Study.
The economy had not yet seen signs of recovery, he added, although he noted an increased focus on agricultural investment, including some from the government.