Minister of Commerce Cham Prasidth will take a direct role in running the Council
for the Development of Cambodia (CDC) after Prime Minister Hun Sen signed a sub-decree
restructuring the foreign investment body.
The July 27 sub-decree will expand the executive from six to seven members, placing
Prasidth above Funcinpec Finance Secretary of State Kong Vibol.
Minister of Finance Keat Chhon will remain as first deputy chairman, but his role
will shift towards soliciting and co-ordinating international aid money.
As deputy chairman, Prasidth will concentrate on raising private investment in Cambodia,
organizing free trade and export processing zones, and streamlining "one-stop
shopping" mechanisms for investing in Cambodia.
"What the Prime Minister has done is try to align trade and investment, because
whenever there is discussion of trade there is discussion of investment," Prasidth
"In the past I was saying one thing and people in Cambodia would say something
different. Now we are trying to be more efficient and trying to speak the same language."
Prasidth has been at the forefront of Cambodia's push for accession to the World
Trade Organization (WTO) and the move will allow him to represent a broader portfolio
in discussions with the WTO, ASEAN and APEC.
Within government and the private sector Prasidth is viewed as a stronger negotiator
than Keat Chhon on proposed changes to investment laws.
"When the new investment laws were proposed I was the first to express my concerns,"
said Prasidth of the controversial changes mooted by the World Bank's Foreign Investment
"[At that time] the situation was different. Since then there has been a world
economic slowdown [and] all amendments have been put on standby until they are satisfactory
to the government and the private sector," he said.
Senaka Fernando, Chairman of the British Business Council, welcomed Prasidth's appointment.
"Cham Prasidth is quite active and he's really trying to promote the capacity
of Cambodia, so having him there is really a plus. However the results of it cannot
be known until we see something concrete," Fernando said.
Foreign direct investment (FDI) in Cambodia has been in decline since 1999. In the
first quarter of 2001 the number of new investment projects plummeted to only half
the level seen in the same quarter last year, according to the most recent Cambodia
Under the current system, foreign investors wanting to take advantage of incentives
such as tax holidays and import duty exemptions, need to go through a cumbersome
registration process with the CDC. The proposed new investment laws would eliminate
these incentives, possibly making the investment body irrelevant. However, with Prasidth
pressing for the retention of investment incentives the CDC is more likely to retain
Private sector representatives will present their case against proposed changes to
the investment laws at a UN and CDC investment workshop in Phnom Penh today. Representatives
of the International Business Club will also plead for greater fairness in tax collection
and more transparent governance, including consultation prior to the issuing of "surprise"
While discussion of changes at the CDC was on the drawing board for some time, the
10-page sub-decree came as a surprise to the private sector, said Fernando.
Other changes contained in the sub-decree include expanding the number of bodies
comprising the CDC from 16 to 39, giving most ministries representation. New members
include the National Police Director General and the President of the Phnom Penh
Chamber of Commerce.