Effects of Chinese slowdown on Cambodian real estate not all bad

Content image - Phnom Penh Post
While the future is uncertain, local experts believe current construction business will be as usual. Pha Lina

Effects of Chinese slowdown on Cambodian real estate not all bad

Cambodian experts still find myriads of reasons for and against the impacts that China’s slower-than-anticipated economic growth could have on the Cambodian real estate market while the overall results remain obscure.

Ann Sothida, deputy director of CBRE Cambodia, who has worked with many Chinese investors, told Post Property on Tuesday that backlashes to the local real estate industry would be minimal – under the condition things do not get worse in China.

“I have asked the Chinese investors about this matter and they told me that they would not postpone their construction projects [in Cambodia]. Yet, they would delay the projects if ongoing construction projects in China would demand extra efforts,” she said.

However, she added that those looking to invest overseas from the Chinese mainland may become hesitant until the storm calms.

“When there is a problem in [China], [the investor] would consider putting off the investment in foreign countries,” she said.

Echoing Sothida, Touch Samnang, project manager of OCIC, said that for the Chinese-dominated Diamond Island, “no projects are on hold” and it is “business as usual.”

However, he did note that sales had recently dipped.

“I heard about the economic crisis in China, but I don’t have any details of it,” he said.

While some see ongoing construction projects unaffected, others believe that Chinese construction has already started to decline.

Surveying the landscape, Sung Bunna, director of Bonna Realty Group said that “some projects from large Chinese companies seem to be stagnant.”

However, he was quick to point out that the overall “the real estate market in Phnom Penh is still progressing” and that investors should take advantage of the changing economic climate. He said that the cost of building materials are dropping and the shortage in the labour market for construction workers could be less acute if Chinese developers employed fewer workers.

Mey Kalyan, economist and advisor to the Supreme National Economic Council, pointed out that it was natural for growth of gigantic economies such as China to decelerate. He added that the overall volume of growth, and incoming FDI from China, “is still significant.”

“The Chinese economy is still expanding, even though the growth rate is lower. It is not harmful as the impact on the Cambodian economy will be slight,” Kalyan said, and continued to explain that from a political, diplomatic and bilateral economic point of view, China and Chinese investors continue to have a strong commitment to Cambodia.

MOST VIEWED

  • Reuters: US Embassy fired 32 staff members for sharing pornography

    The United States Embassy in Phnom Penh has fired 32 non-diplomatic staff members who were allegedly caught exchanging pornographic images and video, including of minors, according to the news agency Reuters. Four sources, who spoke on condition of anonymity, told Reuters the content was shared in

  • Our 2018 guide to spending Khmer New Year in Phnom Penh

    Khmer New Year festivities are upon us. For the next few days, travellers will be making their way to their home provinces to eat, celebrate, play traditional games and visit a pagoda with offerings. If you will be staying put in Phnom Penh for the

  • US think tank warns of China's 'ulterior motives'

    A US think tank on Tuesday warned that spreading Chinese investment in the Indo-Pacific follows a pattern of leveraging geopolitical influence at the expense of the nations receiving investment, including Cambodia. The report looks at a sample of 15 Chinese port development projects, noting that the

  • More than three tonnes of ivory reportedly bound for Cambodia seized in Mozambique

    A total of 3.5 tonnes of ivory reportedly bound for Cambodia was seized by authorities in Mozambique late last week, according to the NGO Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES). CITES' information was based on a report from the