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Yazaki Corporation to launch Koh Kong plant

Construction takes place at the Koh Kong Special Economic Zone
Construction takes place at the Koh Kong Special Economic Zone near the border with Thailand. Japanese investment in Cambodia reached $75 million in 2011. Heng Chivoan

Construction takes place at the Koh Kong Special Economic Zone near the border with Thailand. Japanese investment in Cambodia reached $75 million in 2011. Photograph: Heng Chivoan/Phnom Penh Post

Car parts supplier Yazaki Corporation of Japan plans to officially launch its automotive electronics and instruments plant later this month in Cambodia’s Koh Kong province.

Investment from Japanese firms in the Kingdom has been gradually increasing over the past few years.

Yasuhiko Yazaki, chairman of Yazaki Corporation, during a meeting with Prime Minister Hun Sen at the Peace Palace on Wednesday said the plant, constructed in the Koh Kong Special Economic Zone, is finished and will officially open on December 17.

The construction of the plant used advanced technology and its automotive products will be exported to countries all over the world, he said. Yazaki, however, did not disclose the cost of the investment.

The premier applauded the firm on its decision to invest in Cambodia. The company will be insured by the government, eliminating the risk of natural disasters or political issues impacting on the business’s bottom line.

Suzuki Hiroshi, chief executive and chief economist at the Business Research Institute for Cambodia (BRIC), said this kind of investment by a Japanese parts manufacturer is one of the best ways to harness the advantages of Cambodia – the low cost of labour and its location between Bangkok and Ho Chi Minh City.

“The cost of labour is very important because the production is labour intensive. The easy logistics to the eastern seaboard of Thailand is also important because of transportation costs and time,” he said.

“I believe that Yazaki will export all the products from Koh Kong to Thailand, especially to the eastern seaboard where some Japanese car manufacturers are located.

“Yazaki would be the best example to establish a win-win relationship between the growth of the Cambodian economy and the development of Japanese companies. Yazaki’s investment will invite a good volume of employment and good effects on Cambodian exports. It will also help the diversification of export items and destinations,” he said.

Cambodia’s luxury car demand is about 20,000 units a year – of which Toyota has a 70 per cent market share, Kong Nuon, president of a Cambodian Toyota-authorised dealership, said.

In September, AEON, Japan’s largest shopping mall developer and biggest retailing operator, invested $200 million in building a four-storey shopping mall in Phnom Penh.

Construction is expected to start next week.

Last year Minebea, another Japanese firm, invested $60 million in a manufacturing plant for small- and medium-size cars that began operating last year.

Japanese investment in Cambodia reached $75 million last year, up from about $35 million in 2010, according to the Japanese Embassy in Phnom Penh.

 To contact the reporter on this story: May Kunmakara at kunmakara.may@phnompenhpost.com

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