Logo of Phnom Penh Post newspaper Phnom Penh Post - Steady FDI helps keep economy on course

Steady FDI helps keep economy on course

Steady FDI helps keep economy on course

Total foreign direct investment receipts have remained consistent over the past five years, according to a new government report that incorporates central bank data.

FDI inflows have ranged from $1.5 billion to $2 billion a year between 2012 and 2015, according to the biannual Macroeconomic Outlook issued by the Ministry of Economy and Finance. Meanwhile, the National Bank of Cambodia (NBC) reported separately that the Kingdom received $1.9 billion in FDI in 2016.

Hing Thoraxy, senior researcher at the Cambodian Institute for Cooperation and Peace (CICP), said that the relatively stable level of FDI over the past five years was a result of Cambodia’s strong economic performance. He said consistent inflows have helped stabilise the Kingdom’s macroeconomic indicators, while reducing the poverty rate and diversifying the country’s manufacturing sector.

He predicted that FDI would remain steady in the coming years, supported by the government’s 2015-2025 Industrial Development Policy (IDP) and the Kingdom’s improving investment climate.

“With strong FDI inflows Cambodia will maintain its 7 percent annual GDP growth, create more job opportunities and generate higher income for its people,” he said. “This will help Cambodia to achieve its goal to becoming a higher-middle income country in 2026 or 2027.”

While the MEF report did not break down FDI receipts by source or distribution, NBC figures released earlier this year showed that over $539 million, or about a quarter, of all FDI logged last year was directed to the financial sector. The manufacturing and property sectors received the next largest shares of FDI, with $390 million and $370 million, respectively.

According to the NBC, China was the largest investor last year, providing $511 million, followed by Hong Kong, Vietnam and Japan.

In Channy, president and group managing director of Acleda Bank, said Cambodia could expect further substantial investment from these countries, contributing to industrial growth and higher incomes.

“FDI inflow into assembly factories and electronics manufacturing will increase and this kind of industry and will provide higher wages for Cambodian workers,” he said.

MOST VIEWED

  • Phnom Penh placed in two-week lockdown

    The government has decided to place Phnom Penh in lockdown for two weeks, effective April 14 midnight through April 28, as Cambodia continues to grapple with the ongoing community outbreak of Covid-19, which has seen no sign of subsiding. According to a directive signed by Prime Minister

  • Cambodia on the verge of national tragedy, WHO warns

    The World Health Organisation (WHO) in Cambodia warned that the country had reached another critical point amid a sudden, huge surge in community transmission cases and deaths. “We stand on the brink of a national tragedy because of Covid-19. Despite our best efforts, we are

  • Hun Sen: Stay where you are, or else

    Prime Minister Hun Sen warned that the two-week lockdown of Phnom Penh and adjacent Kandal provincial town Takmao could be extended if people are not cooperative by staying home. “Now let me make this clear: stay in your home, village, and district and remain where

  • Businesses in capital told to get travel permit amid lockdown through One Window Service

    The Phnom Penh Municipal Administration has issued guidelines on how to get travel permission for priority groups during the lockdown of Phnom Penh, directing private institutions to apply through the municipality's One Window Service and limit their staff to a mere two per cent. In

  • Ministry names types of business permitted amid lockdown

    The Ministry of Labour and Vocational Training singled out 11 types of business that are permitted to operate during the lockdown of Phnom Penh and Takmao town, which run through April 28. Those include (1) food-processing enterprises and slaughterhouses; (2) providers of public services such as firefighting, utility and

  • Culture ministry: Take Tuol Sleng photos down, or else

    The Ministry of Culture and Fine Arts has told Irish photographer Matt Loughrey to take down the photos of Khmer Rouge victims at Tuol Sleng Genocidal Museum which he allegedly colourised and altered to show them smiling. The ministry said Loughrey's work is unacceptable, affecting