A total of 1,947 industrial-scale factories operated in Cambodia at least at some point during the quinquennial period between August 2017 and July 2022, rising by 425 units or 27.92 per cent from the previous five-year interval, according to the Ministry of Industry, Science, Technology and Innovation.
In its report on its achievements over the five years to end-July 2022, the industry ministry said 1,107 new such factories opened during the period, while 682 closed.
In the first seven months of 2022, a total of 112 new factories created 76,624 job positions and 47 closures cost 16,838 jobs. As of July 31, total capital investment across all projects clocked in at $15.707 billion, rising by 66.91 per cent compared to the same period in 2021, or $9.41 billion.
Ministry secretary of state Heng Sokkung told a press conference on August 11 that the industrial sector’s share of gross domestic product (GDP) remained relatively steady in 2020, at 34.40 per cent, even as the economy contracted by around 3.1 per cent. He predicted that the sector’s contribution to GDP would increase to 39.90 per cent this year.
Sokkung noted that an earlier goal to push up the sector’s annual GDP contribution to 30 per cent by 2025 was achieved a full eight years in advance, with 2017’s figure reaching 30.90 per cent. Industry’s share in GDP “has been steadily growing, higher than for other sectors”, he said.
Going forward, this growth will be fuelled by the wider use of modern technologies in the sector, along with the development of industries more heavily reliant on sophisticated skills coupled with cutting-edge tech and novel practices, which will add considerable value to Cambodia’s GDP, he maintained.
Sokkung credited the handsome amount of new factories that started operations in the January-July period to Cambodia’s handle on the Covid-19 situation, despite double-digit increases in active cases each day, as well as a number of regulatory safeguards in place for investors.
Hong Vanak, a researcher at the Royal Academy of Cambodia, commented that reports of increases in industrial exports suggest that the economy has begun a progressive return to normality, following Covid-19 shocks to key pillars such as tourism, garments and transportation.
“We expect that government policies that promote the use of technology in the industrial sector will be able to drive export growth, increase value added in the sector, and especially contribution to GDP,” he said.
The ministry reported that, in June, the total value of goods production in Cambodia topped $7.577 billion, up by $3.254 billion or 75.27 per cent year-on-year, of which $2.315 billion supplied domestic markets and $5.262 billion was exported.