With an eye on the ASEAN Economic Community integration later this year, the EU-ASEAN Business Council conducted a survey to gauge the outlook of European businesses in Cambodia and the region.
Of the 151 respondents, Cambodia was ranked the second-most important country by businesses in terms of total turnover for their ASEAN operations after Singapore.
However, the report noted that the unexpected result could be attributed to a high number of responses from Cambodia – 38 of the 151 were based in the Kingdom.
“Once AEC is fully implemented, a country like Cambodia will benefit because some of those hurdles with imports and exports will be taken away,” said Andre de Jong, managing director for German firm Bosch in Cambodia, Laos and Myanmar.
“If it happens, they can become more cost effective.”
About 63 per cent of companies in Cambodia, like the rest of the region, expected to see profit increases this year and in future years.
Blaise Kilian, advocacy manager for European Chamber of Commerce in Cambodia, said that while there was positive business sentiment in the Kingdom, a lack of clarity on the AEC’s implementation made it hard for firms to plan for the future.
“The limited connectivity of the Kingdom to the regional economy as compared with the other countries would explain the fact that only 55 per cent of Cambodian respondents plan to expand their operations in ASEAN,” he said.