REPRESENTATIVES from seven of the United States’ most influential multinational corporations engaged top Cambodian officials in frank talks this week, in part on obstacles to investment, as companies assessed the viability of long-term projects in the Kingdom during an US-ASEAN Business Council visit.
Representatives from energy companies Chevron and ConocoPhillips, pharmaceutical giant Johnson & Johnson, defence contractor General Dynamics, technology leader IBM, agricultural firm Bunge and infrastructure, media and finance company General Electric met with leading officials from multiple government ministries Monday and Tuesday.
Delegates of the fourth annual American mission hoped to gain a clearer picture of Cambodia’s economic climate and conduct talks with politicians regarding the “challenges” the Kingdom must face to attract long-term investment, representatives of the US-ASEAN Business Council told the Post Tuesday.
Issues of governance, transparency, regulation and infrastructure concerns, such as the high cost of electricity, were all raised by delegates over the course of the talks – which tackled both the progress of existing investments and potential new projects.
“If Cambodia wants to be more competitive things need to change. Most ministers understand this. We want to see the business environment take off,” said US-ASEAN Council President Alexander Feldman, whose organisation represents more than 100 US companies that conducted US$4.5 trillion in global sales last year.
But he praised recent signs of development, such as the Kingdom’s recently-approved anticorruption legislation, and highlighted possible long-term US investments that he said have the potential to bolster Cambodia’s infrastructure and domestic skills base.
Though no new deals have yet been struck, companies have voiced ambitions to move forward in the Kingdom.
Feldman said that renewable and green energy proved a focus for discussion, as General Electric is looking at the development of wind turbine technology and Bunge is considering Cambodia’s biofuel potential.
Meanwhile, defence firm General Dynamics was taking part in a fact-finding operation to consider the provision of air-traffic control technology to the Kingdom.
Johnson & Johnson could work with the government to tackle medical counterfeiting, which, Feldman said, remains “a major impediment” to the firm’s entering Cambodia in force.
Multinationals that already have concessions in the Kingdom also took part in the trip.
ConocoPhillips, which holds interests in an internationally disputed offshore energy block, and Chevron, which Prime Minister Hun Sen has ordered to produce oil in offshore Block A by 2012 or forfeit its licence, both met with officials.
The US-ASEAN Business Council highlighted regulations regarding petrol pricing and law as topics for consideration.
The council also detailed IBM’s intention to expand and Feldman said that US investment in developing nations typically has a long-term outlook, which is not just based on Cambodia’s low labour costs.
“US companies are quality investors. We would provide something of use to Cambodia,” he added.
He highlighted technological innovation and social responsibility as benefits of American dollars splashed in the Kingdom, which has seen Chinese investment flood into the country in recent years.
“We want to work with the government to make the business environment more conducive to attracting international investors,” Feldman said.
US-ASEAN Business Council manager Anthony Nelson added that it also aims to “establish what the government’s priorities are”.
The delegation has visited the Ministries of Finance, Commerce, Health, Trade, Foreign Affairs, Education and Posts and Telecommunications.
Council of Ministers spokesman Phay Siphan said Tuesday: “Cambodia has taken the utmost effort to create an environment in which business investment can grow. It will become better and better.”
He pointed to the anti-graft law and Cambodia’s commitment to meet World Trade Organisation standards as positive forces in the business sector.
US-Cambodia trade has risen from around $25 million in 1996 to an estimated $2 billion in 2009, the business council said.