The new Law on Investment will be a crucial tool as the Kingdom pushes ahead with post-Covid-19 economic recovery plans, and help lay the groundwork to maximise benefits from free trade agreements (FTA), according to Cambodia Chamber of Commerce (CCC) president Kith Meng.
He made the remark at a virtual workshop on the law, organised by the Council for the Development of Cambodia (CDC), in collaboration with the CCC, and presided over by CDC secretary-general Sok Chenda Sophea. The leadership and around 400 members of the CCC were also in attendance.
Meng said: “The private sector strongly believes that this investment law will be effectively implemented to create an open, transparent, predictable and efficient legal framework to investment.”
The CDC’s Chenda Sophea said the new investment law was designed to respond to geopolitical and economic changes caused by the ongoing Sino-US trade spat, the Fourth Industrial Revolution, the digital transformation, and the disruptions to the global value chain caused by the Covid-19 pandemic.
“The new investment law also takes into account the promotion of small- and medium-sized enterprises [SME] by providing incentives to SMEs in priority areas and boosting connectivity with large enterprises,” he said.
He added that partnerships between the government and the private sector are essential to help the economy grow.
Initiated in 2015, the investment law underwent thorough research and development, led by a CDC working group, and was designed in accordance with the guidelines of the Industrial Development Policy 2015-2025.
The first working version of the draft law was completed at the end of the first half of 2019, in accordance with recommendations made by Prime Minister Hun Sen at the 18th Government-Private Sector Forum on March 29 that year. The new law was approved by the National Assembly last month.
The Ministry of Economy and Finance reported that just 75 private investment projects planned outside of special economic zones (SEZ) were approved by the CDC in the first eight months of 2021, down by nearly 30 per cent year-on-year.
The report presented an overall glum picture for new investments in non-SEZ projects, with new ventures approved by the CDC in January-August involving a total capital investment valued at $1.106 billion, dipping by 52.5 per cent year-on-year, and expected to create 57,000 jobs, contracting by 32.3 per cent on a yearly basis.