Logo of Phnom Penh Post newspaper Phnom Penh Post - October investment sees downward trend continue

October investment sees downward trend continue

October investment sees downward trend continue

091204_11
Vietnam’s Sacombank opens its Phnom Penh branch earlier this year. Investment in the Kingdom has dropped dramatically so far in 2009.

Analyst says monthly drop does not necessarily paint full picture

THE number of approved investment projects in Cambodia fell dramatically in October compared with the same month in 2008, according to figures from the Centre for the Development of Cambodia (CDC) released Thursday, as large projects failed to materialise following the economic downturn.

Only US$15.5 million in projects were approved in October, a 98 percent drop compared with the $869.8 million in projects given the green light during the same month in 2008.

According to the CDC’s statistics, four major “tourism” projects worth a total of $704 million provided the majority of last October’s approvals.

The first 10 months of the year has seen approvals totalling only $1.624 billion, a far cry from the $9.928 projects certified during the same period last year.

An official from the CDC, who spoke on condition of anonymity, said the drop in investment projects resulted from a lack of capital flow from foreign countries.

“Most investors borrow money from banks, and the downfall of big banks around the world has systematically affected the flow of capital into Cambodia,” said the official.

During October the Cambodian government gave the go-ahead to only two projects: a shoe factory and a lightweight manufacturing development.

Kang Chandararoth, president of the Cambodian Centre for Study and Development, said October’s downturn in investment into Cambodia was not necessarily cause for alarm.

“We cannot evaluate investment each month because it is meaningless in evaluating change in the direction of an economic structure. We should make the comparison on a quarterly or yearly basis,” he said.

Sam Rainsy Party lawmaker Son Chhay said there were underlying problems in attracting capital to the Kingdom beyond the global financial crisis, namely high electricity prices, inadequate human resources and bureaucracy.

MOST VIEWED

  • Diplomatic passports issued to foreigners to be annulled

    The Ministry of Foreign Affairs and International Cooperation will move to annul diplomatic passports issued to those not born in Cambodia. Analysts say the move may be in relation to reports that former Thai prime minister Yingluck Shinawatra used a Cambodian passport to register as

  • The hairy little heroes saving many lives in rural Cambodia

    IN RURAL Siem Reap province, rats dare to tread where no person will, as these hairy little heroes place their lives on the line each day for the good of the local community. The rodents are the most important members of a special team, leading

  • Hun Sen warns Irish MP of EBA ‘mistake’

    Prime Minister Hun Sen on Saturday told former Irish premier Enda Kenny, still a member of the EU nation’s parliament, that the 28-nation bloc should not make a “third mistake” regarding Cambodia by using the preferential Everything But Arms (EBA) agreement to “take 16 million

  • PM warns EU and opposition on 34th anniversary of his rule

    HUN Sen reached the milestone of 34 years as Cambodian prime minister on Monday and used the groundbreaking ceremony for a new ring road around Phnom Penh to tell the international community that putting sanctions on the Kingdom meant killing the opposition. “Please don’t forget