Logo of Phnom Penh Post newspaper Phnom Penh Post - Cambodia ranks low as investment draw

Cambodia ranks low as investment draw

Cambodia ranks low as investment draw

Cambodia is one of the least-attractive investment destinations in ASEAN, according to new findings that an economic adviser to the government is already challenging.

Released last week, the 2013 ASEAN Competitiveness Survey ranked Cambodia above only Brunei in terms of investor “attractiveness”.

Just 21 per cent of the survey’s 502 respondents, all of whom hailed from the business community in ASEAN, identified Cambodia as a desirable nation for future investment.

Meanwhile, more than 40 per cent said they intended to invest in Singapore, Malaysia, Indonesia or Thailand. Thirty-eight per cent identified Myanmar, 36 per cent cited Vietnam and 24 per cent chose Laos as alluring foreign investment options. Consequently, Cambodia scored an overall “attractiveness rating” of 4.06 out of a possible 10, beating only Brunei’s 3.67.

“This is a big surprise,” Mey Kalyan, an adviser to the Supreme National Economic Council (SNEC), said.

“I have heard investors’ assessments of Myanmar that suggest the investment climate for infrastructure, telecommunications companies and legal frameworks are not yet right.”

Produced by the ASEAN Business Advisory Council, the survey tookTc into account responses from only three companies in Cambodia, while 72 per cent of the responses came from Thailand and Vietnam.

The ASEAN council is a working group that was formed in 2003 to provide private-sector feedback on the region’s economic integration.

The local firms that took part in the survey between May and August were the Alliance of Rice Producers & Exporters of Cambodia, Manulife Cambodia and Winson International Garments Ltd. All three could not be reached for comment.

Kalyan said that while Laos has a stronghold on the region’s energy resources, Cambodia’s liberal foreign investment regulations, which allow 100 per cent foreign ownership of companies, cheap labour costs and relative political stability, are all major drawcards for investment.

“It might be that Myanmar labour is cheaper, but you must be mindful of equity issues for workers and the skill level of your production,” he said. “There are weaknesses in infrastructure and energy, but these are not decisive factors.”

The ASEAN survey also found that Cambodia’s outward foreign direct investment activity, or export trade, was among the least attractive to investors, with just 3.3 per cent of respondents naming the Kingdom as a planned export location within the next three years.

Grant Knuckey, CEO of ANZ Royal Bank, said the survey proves how competitive ASEAN is for investment, and while Cambodia is an attractive destination, it cannot afford to slow its economic development.

MOST VIEWED

  • Rainsy stopped in Paris from boarding Thai flight

    Airline officials at Paris’ Charles de Gaulle airport on Thursday prevented Sam Rainsy from boarding his flight to Bangkok ahead of his announced return to Cambodia on Saturday. Prime Minister Hun Sen had earlier in the day assured Phnom Penh residents that there would be

  • Analyst: Rainsy blocked from boarding flight 'an excuse'

    THAI Airways not allowing Sam Rainsy on its route from Paris to Bangkok on Thursday is being used as an excuse to keep his standing among fellow coup plotters and his uninformed supporters as flights to non-Asean countries are available, an analyst said on Friday.

  • Rainsy lands in Malaysia

    Cambodian opposition figure Sam Rainsy arrived in Kuala Lumpur airport on Saturday afternoon after boarding a flight from Paris, where he has been living for more than four years. Ministry of Foreign Affairs and International Cooperation spokesperson Koy Kuong said on Saturday that Cambodia respected

  • Touch: Rainsy will never return

    Sam Rainsy, the “acting president” of the Supreme Court-dissolved Cambodia National Rescue Party (CNRP), has claimed it has achieved 70 per cent of its struggle to find a solution to the current political situation in the Kingdom. Just before boarding a plane at Charles de Gaulle

  • Sokha continues call for dropping of charge after bail conditions reduced

    Not satisfied with having his bail conditions reduced, allowing him to travel freely in Cambodia, Kem Sokha says he wants his charge totally dropped. “As an innocent man who has been in detention for two years even without being found guilty, I continue to demand

  • MEPs' call for Rainsy's safety not European Parliament position

    The European Parliament said on Friday that a statement by 56 Members of the European Parliament (MEPs) calling for guarantees of Sam Rainsy’s freedom and safety should he return to Cambodia did not represent its position. Delphine Colard, the European Parliament’s press officer told