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Japanese companies still avoid Cambodia

A LACK of information about investment coupled with Cambodia’s small manufacturing sector has dissuaded Japanese businesses from setting up in the Kingdom, an industry expert said Thursday.

“The lack of information is the biggest obstacle for Japanese investors who want to make decisions about whether to invest in Cambodia,” said Yuji Imamura of the Japan International Cooperation Agency (JICA), who is also the advisor in charge of investment and environmental improvement at the Council for the Development of Cambodia (CDC).

Imamura said that most Japanese investors are interested in the manufacturing industry.

He pointed out that Cambodia has only 21 special economic zones (SEZ), where the Government can give manufacturers tax incentives. Only eight are currently operational, attracting just 36 businesses.

“There are only a few SEZs in Cambodia, compared to those of Vietnam and Thailand. Vietnam has up to 218,” he said.

According to CDC data for 2009, Japanese investment in Cambodia dropped 39 percent to US$4.76 million in 2009, from $7.82 million in 2008. Japan was ranked the 12th-largest international investor in the Kingdom.

He predicted that there will be more Japanese investors in Cambodia after the SEZ at Sihanoukville Autonomous Port is completed in 2011 courtesy of a $40 million soft loan from Japan.

“Many Japanese investors have expressed their interest in Sihanoukville SEZ,” he added.

Ajinomoto, a Japanese company producing MSG among other food flavourings,

Ichiro Nishimura, the CEO of Ajinomoto (Cambodia) Ltd, a manufacturer of food flavourings including MSG, previously told the Post that Japanese firms often have a negative perception of Cambodia, but that is usually changed upon visiting the country.

His company is building a new factory in the Phnom Penh Special Economic Zone.

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