Investment Environment and Opportunities in Cambodia presented by SUON SOPHAL Deputy Director Department of Public Relations and Investment Promotion Council for the Development of Cambodia
Key Indicators Land area : 181,035 sq.km. Population: 14.1 Million Labor force (young) : 7,053,398 (Female: 3,608,345) Population growth rate : 1.54% GDP Growth (2011) : 7.1% GDP per capita in 2011 : $909 Inflation (2011) : 5.5% Exchange rate: USD 1= 4075 Riels
Economic Performance 14% Average growth for last 5 years is 10.3% 25.00% 12% 20.00% 10% 15.00% 8% 6% 4% z 10.00% 5.00% 2% 0.00% 0% 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 GDP 9.20% 6.50% 5.30% 5.70% 5.00% 12.60% 9.20% 7.70% 6.20% 8.60% 10.0% 13.3% 10.8% 10.2% 6.70% 0.10% 5.90% 7.10% Infla on 17.90% 3.50% 10% 9.20% 13.30% 4.00% -0.80% 0.20% 3.30% 1.20% 3.90% 5.80% 4.70% 5.9% 19.70% -0.60% 4.00% 5.50% -5.00% 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 GDP per capita 331 356 402 468 534 623 738 731 830 909 Source: SNEC & MEF
ONE STOP SERVICE OPEN DOOR POLICY
Council for the Development of Cambodia (CDC) Samdech Akka Moha Sena Padei Techo HUN SEN Prime Minister of the Kingdom of Cambodia Chairman H.E. Mr. Keat Chhon, Deputy Prime Minister Minister of Economy and Finance 1 st Vice Chairman Trouble Shooting Committee H.E. Mr. Sun Chanthol Senior Minister in charge of Special Missions Permanent Vice Chairman H.E. Mr. Cham Prasidh, Senior Minister, Minister of Commerce 2 nd Vice Chairman H.E. Mr. Sok Chenda Sophea Minister attached to the Prime Minister Secretary General H.E. Mr. Kong Vibol Secretary of State of Economy & Finance Vice Chairman H.E. Mr. Sok Chenda Sophea Minister attached to the Prime Minister Secretary General CSEZB H.E. Mr. Chhieng Yanara Secretary General CRDB H.E. Mr. Sok Chenda Sophea Secretary General CIB H.E. Mr. Chea Vuthy Deputy Secretary General CSEZB H.E. Mr. Leap Vanden Deputy Secretary General CRDB H.E. Mr. Rith Vuthy Deputy Secretary General CRDB H.E. Mr. An Sophanara H.E. Mr. Chea Vuthy H.E. Mr. Heng Soknang Deputy Secretary General CIB SEZ ODA GMS National Secretariat FDI
Information & Application Approval Customs Duty & Tax Exemption Visa & Work Permit Company Registration A ONE STOP SERVICE
Licensing Authorities Council of Ministers : CDC but needs approval from CoM for project with investment capital exceeding $ 50 million, BOT, BOOT, BOO or BLT, longterm strategy, sensitive projects: negative impact on the environment and natural resource exploitation CDC : less than $ 50 million Provincial Authorities : less than $ 2 million
Investment Approval Investment application CDC issues a Conditional Registration Certificate to the Applicant 3 working days Company Registration / Ministry of Commerce Relevant licenses, as appropriate / Ministry of Industry and Energy Review and approval of construction plan / local authorities- Ministry of Land Management, Urban Planning and Construction. Initial environmental impact assessment / Ministry of Environment 28 working days Tax Department Registration / Ministry of Economy and Finance CDC issues a Final Registration Certificate to the Applicant
Qualified Investment Project Approval Investor In Special Economic Zone Outside Special Economic Zone Application for QIP Application for QIP No Application for QIP Cambodia Special Economic Zone Board (CSEZB) Cambodia Investment Board (CIB) Ministry of Commerce Conditional Registration Certificate (3 working days) Over US$50 million,natural Resources ; to Council of Minister via CDC Conditional Registration Certificate (3 working days) Under US$2 million ; to Sub-Committee on Investment of the Provinces-municipalities SEZ One Stop Service Office Final Registration Certificate (28 working days) Company Registration Construction of Factory Start Production
Investment Incentives 20% Corporate Tax Tax holidays: Trigger period +3years+n; 6y <TH<9y Full Import Duty Exemption Repatriation of profit (withholding tax) Reinvestment of earning (special depreciation)
Investment Protection The Investment Law and Sub-decree contains a number of important guarantees for the investors: Equal treatment of all investors No requirement of local equity participation No price controls on products or services No restriction on forex convertibility Free remittance of foreign currencies abroad
Bilateral agreement on the promotion and protection of investments between the Kingdom of Cambodia and other countries 1. Australia 2. Austria 3. China 4. Croatia 5. Cuba 6. Czech 7. France 8. Germany 9. Indonesia 10. Japan (14 June 2007) 11. Kuwait 12. Lao PDR 13. Malaysia 14. Netherlands 15. N. Korea 16. OPEC 17. Pakistan 18. Philippine 19. ROK 20. Singapore 21. Switzerland 22. Thailand 23. USA (OPIC) 24. Vietnam
Investment Opportunity Agriculture and Agro Industry Transportation and Telecommunication Sector Energy Sector Labor Intensive Industries and Export Oriented Industries Processing Industry Tourism Sector Human Resource Development Oil & Gas, Mining
China Hong Kong Taiwan EU Malaysia USA Korea Singapore Thailand Japan Vietnam Approved Investments by Country/Region (1994-2011) US$ Million 8,849 9,000 8,000 7,000 6,000 5,000 4,000 3,641 4,040 3,000 2,614 2,000 1,000 641 839 1,282 649 746 154 1,200 0
Approved Investments by Sector 1994 2011 Agriculture 7% Service 19% Korean FDI in Cambodia -160 projects -4,118 Million $ Industry 24% Tourism 50%
Infrastructure: A definite prospect Priority for infrastructure Infrastructure rehabilitation and Logistic development Multilateral aid availability Decentralization Regional opportunities ASEAN & GMS integration Private Participation in Infrastructure (PPI): BOT, BOO, etc
Agro-business Basic agrarian economy Natural endowments: Rich fishery resources Good weather Organic crops Value-added added emphasis Food processing New product development
Tourism World Heritage Monuments Open Sky Policy to Siem Reap Natural beauty - Beach - Islands Ability to attract add-on trips Novelty value
Poipet 150 km Tourism Center Eco-Tourism 314km Gulf of Thailand 230 km Sihanoukville Bokor (hill resort) Beach & Island Resorts
Visitors to Cambodia Thousand (000) Vision 2020: Visitor arrival from 2010 2020 YEAR 2010 2011 2015 2020 Visitor Arrivals 2,508,289 2,882,000 3,700,000 6,000,000
Top ten markets arrival from January-May 2012 Vietnam U.S.A Korea Japan China France Lao PDR U.K Thailand Russia
Investment Opportunities Phnom Penh o International Convention Center o High-end hotel (Four Seasons, Hyatt, etc ) at the moment there are only Intercontinental Hotel, Sofitel and Raffles with approximately 500 rooms. Siemreap o International Convention Center o High-end hotel (Four Seasons, Hyatt, Sheraton, and Marriott, etc ) at the moment there are only Raffles, Le Meridien, Sofitel, Aman resorts and Orient Express, with approximately 700 rooms. o Amusement park / recreational activities o Golf course (there are three existing golf courses) Sihanoukville o High-end hotel (Four Seasons, Hyatt, etc ) o Golf Course
Manufacturing & Export Competitive labor cost Tax incentives Market access Regional arrangement
MFN/GSP Market Access Australia Austria Belarus Belgium Bulgaria Canada China Czech Republic Denmark Finland France Germany Hungary Ireland Italy N-Korea Luxemburg Japan Netherlands New Zealand Norway Poland Portugal ROK Russian Federation Slovakia Spain Sweden Switzerland UK USA EBA (everything but arms initiative for LDCs) and the ASEAN integration System Of Preferences (AISP) from the ASEAN 6
Cambodia s Special Economic Zones Poipet O Neang SEZ Koh Kong SEZ Souy Chheng SEZ Phnom Penh SEZ Thary Kompong Cham SEZ Oknha Mong SEZ P (SEZ) I C Kiri Sakor Koh Kong SEZ Sihanoukville SEZ1 Sihanoukville SEZ2 Stung Hao SEZ GoldFame Pak Shun SEZ No Activities Under Construction S.N.C SEZ Kompong Som SEZ Sihanoukville Port SEZ Kampot SEZ Duong Chhiv SEZ Operational
One Stop Service Special Economic Zone Administration Company registration and investment license Export/import permit Work permit and Labor books (both workers and expatriate) SEZA will provide on site immediate legal and administrative assistance
Percentage of Population by age group Census 2008 The elderly population 4.30% Children (0-14) 33.70% Economically productive age group (15-64) 62% Source: NIS
Cambodia has embraced the globalization process as part of its outward looking economic development strategy. ACCESS TO THE U.S. MARKET ACCESS TO THE EUROPEAN MARKET JOINING ASEAN JOINING WTO
Reasons to invest in Cambodia Open economy Sound Macroeconomic Environment Competitive Investment Incentives One Stop Service Fast-Track Investment Approval Process (28 days) Low Labor Cost Strategic Location Preferential Trading Status Access to ASEAN and World Markets
Myanmar Yangon Thailand Bangkok Hanoi Laos o Vientiane Kunming Vietnam Southern China Manila 1h:30 in average. CAMBODIA Phnom Penh The Philippines Brunei Kuala Lumpur Begawan Malaysia Jakarta Singapore Indonesia
Invest in Cambodia and Invest and and you you you have have have 325 14 million 600 million consumers million consumers consumers virtually at your at doorstep your doorstep
Thank you For more information please visit: Tel : (855) 23 981 154 Fax : (855) 23 428 426 Email : cdc.cib@online.com.kh www.cambodiainvestment.gov.kh