Investment Hightlights
Cambodia Weekly Financial News 09~13 Jan 2023
2023-01-14View Times｜ 1058
Cambodia Weekly Financial News
09~13 Jan 2023
09 January 2023
MEF changes tax rules for commercial gambling businesses
The Ministry of Economy and Finance (MEF) has started implementing the revenue-based taxation rules and procedures on commercial gambling businesses on the self-declaration regime since December 30, 2022, after the lump sum-based taxation method had been practiced for several decades, said a senior official of the ministry. Commercial gambling businesses are also required to follow the International Financial Reporting Standards (IFRS)—a set of accounting standards that govern how particular types of transactions and events should be reported in financial statements, which were developed and maintained by the International Accounting Standards Board (IASB), the official said.
Source: Khmer Time
09 January 2023
$4.685 billion investment projects approved in 2022
The Council for the Development of Cambodia (CDC) approved fixed asset investment projects worth over $4.685 billion in 2022, up 7 percent as compared to a year before. The CDC issued final registration certificates for new non-special economic zones (SEZ) investment projects with a total value of $3,449 million, a year-on-year increase of 49 percent, the report showed on Friday. The investment projects registered in the SEZ decreased by 39 percent to $1,235 million, the report added. Local investment projects with a total capital of $2,707 million accounted for 57 percent of total investment, while foreign investment from China was registered at $1,408 million or 30 percent, stated the CDC’s report. Other foreign investments in the Kingdom were from Thailand, Japan, the Cayman Islands, Singapore, Korea, the British Virgin Islands, Malaysia, and Australia, it pointed out.
Source：Khmer Time
09 January 2023
Tax break for textile-linked industries to stay till 2025
The government has extended a suspension of “advance income tax” until the end of 2025 for eligible textile-related enterprises, a good deal of which have been hurt by a drop in orders as a result of global economic headwinds linked to the ongoing Ukraine crisis. The decision comes after the Textile, Apparel, Footwear and Travel Goods Association in Cambodia (TAFTAC) in October asked the Ministry of Economy and Finance to extend the “Suspension of Advance Income Tax of Enterprises in the Textile and Garment Industry”. In a prakas that it issued on January 6, the finance ministry noted that at least some of the eligibility criteria are based on the scale and scope of operations, sustainability, and worker support. It listed textiles, garments, bags, footwear, and hats as possible items that can be produced by entities entitled to the tax break.
Source：The Phnom Penh Post
10 January 2023
Cambodia’s export to Japan jumps 11.4%
Cambodia exported $1.81 billion worth of products to Japan in the first 11 months of last year, a year-on-year increase of 11.4 percent, according to the data from the Japan External Trade Organization (JETRO). From January to November, Cambodia’s import from the East Asia nation was valued at $473 million, a decrease of 10 percent compared to the same period last year. The Kingdom’s trade surplus with Japan is pegged at $1.33 billion. The country’s main export to Japan are garments, bags, footwear, furniture, cosmetics, paper and office supplies, and leather goods. Cambodia imported machinery, automobiles, electronics, furniture, fabrics, and plastics from Japan. Cambodia looks upon Japan as a prioritized trade partner. Talks on a bilateral free trade agreement (FTA) to be established, according to the Ministry of Commerce.
Source：Khmer Time
10 January 2023
Australia, and Cambodia issue market research booklets to boost trade
The Cambodian Ministry of Commerce and the Australian Embassy, along with relevant institutions, on 9 January co-launched two key market research publications and a Single Digital Platform development project. It is hoped the market information booklets – Cambodian Crops with Prospects for the EU and RCEP Markets and Cambodia and Unlocking Global Markets by Leveraging Free Trade Agreements (FTA) – will serve as guides to unlock long-term benefits for Cambodia’s agricultural sector. Minister of Commerce Pan Sorasak said Cambodian Crops with Prospects for the EU and RCEP Markets offer important insights into market demand, consumer preferences, sanitary and phytosanitary biosecurity measures, non-tariff barriers to trade, product utilization, key competitors and potential windows of opportunity.
Source：The Phnom Penh Post
10 January 2023
Exports rise 16% to over $22B, trade deficit dips
Cambodia’s total merchandise exports reached $22.483 billion in 2022, rising by 16.44 percent over 2020, narrowing its international trade deficit by 20.60 percent to $7.459 billion, according to the General Department of Customs and Excise (GDCE). The 2022 international merchandise trade came in at $52.425 billion, up 9.19 percent on a yearly basis, with imports accounting for $29.942 billion, up 4.32 percent. Cambodia Chamber of Commerce vice-president Lim Heng believes that the trend will continue in 2023, as the Kingdom’s bilateral and multilateral free trade agreements (FTA) and preferential trade arrangements with the EU and US springboard local products into the international marketplace.
Source：The Phnom Penh Post
11 January 2023
Record-shattering 2022 CSX feats put momentum ‘on the right track’
The Cambodia Securities Exchange (CSX) has heralded 2022 as a major year, with seven new listings, versus just two in 2021. These were: JS Land Plc’s initial public offering (IPO) on the Growth Board, three corporate bond issues from Royal Railway Plc, and three listings of government (sovereign) bonds issued by the Ministry of Economy and Finance – the first of their kind in Cambodia. In the CSX 2022 Achievements, Outlook, and Plans for 2023 bulletin, the local bourse commented that 2022 “was filled with world-changing events causing massive hits to the world’s economy as a whole. It reported 222 billion riels ($55.5 million) in capital raised last year – up 133 percent over 2021 – with corporate and sovereign bonds accounting for 63 percent and 32 percent, respectively. Although average daily trading volume witnessed a “slight decrease”, the corresponding value “doubled” for a second consecutive year, passing two billion riels and hitting “another record-high”, it said.
Source：The Phnom Penh Post
11 January 2023
1.4 MWp rooftop solar PV system in Cambodia planned for development
Cleantech Solar, a commercial and industrial (C&I) solar PV developer, has inked a long-term solar partnership with Can Sports Shoes Co. Ltd. in Cambodia to develop a 1.4 MWp rooftop solar PV project. Can Sports Shoes is a subsidiary of Taiwan-based footwear manufacturer Sports Gear Co., Ltd. Cleantech Solar will provide the turnkey solar energy solution to the client along with operating and maintaining the solar PV system throughout the term of the agreement. The project will be installed on the rooftop of Can Sports’ manufacturing plant in the province of Kampong Chhnang. It is expected to generate over 40 GWh of clean electricity, which amounts to offsetting nearly 26 kilotons of CO2 emissions during the term of the PPA. This will help Can Sports Shoes to make their manufacturing process highly sustainable and innovative, exploiting the benefits of solar power without investing any capital and without having to take on any performance risk of the PV system.
Source：Khmer Time
12 January 2023
SERC launches online trading account opening for derivatives
The Securities and Exchange Regulator of Cambodia (SERC) of the Ministry of Economy and Finance (MEF) on Monday released a set of guidelines on online opening trading accounts online for derivatives to keep the implementation of existing applicable laws and identify traders amid market development in the country. SERC has set procedures of application for derivatives brokerage firms to follow if they wish to use the online system of opening derivatives trading accounts for their investors by fulfilling forms to be submitted with enclosed documents determined by the regulator that would visit the firms’ operations offices and check the system obviously. SERC also will issue a written notification that would specify whether it approves or not the applications submitted by derivatives brokerage firms based on the check-and-balance principles, relevant regulations, and requirements set by the regulator. SERC requires brokerage firms to develop online derivatives trading account opening systems themselves or have the system developed by an information technology supplier licensed by SERC.
Source：Khmer Time
12 January 2023
Kingdom’s GFT exports grow by 15% in 2022
Cambodia’s exports of garments, footwear, and travel (GFT) goods grew by around 15 percent in 2022 compared to the previous year, from $10.99 billion to $12.63 billion, but the total share of the sector declined marginally, according to the latest report on trade by the General Department of Customs and Excise (GDCE). The GFT sector continued to be the largest export earner for the country accounting for 56.2 percent of the total exports last year but its share declined from 56.9 percent in 2021, showed the GDCE report released on Tuesday. Among the GFT goods, exports of footwear grew by 24.8 percent in 2022 compared to the previous year, while non-knitted apparel articles went up by 21.4 percent, travel goods by 17.6 percent, and knitted apparel articles by 9.4 percent.
Source：Khmer Time
12 January 2023
Cambodia seeks Turkish investment, eyes $1B bilateral trade
To boost bilateral trade to around $1 billion (TL 18.78 billion), Cambodia has sought investments from Türkiye in agriculture, storage, and processing facilities for exports to the European Union and other nations. During a meeting in the Cambodian capital Phnom Penh on Wednesday, Cambodian Prime Minister Hun Sen and Türkiye’s Minister for Agriculture and Forestry, Vahid Kirişci discussed bilateral relations and ways to boost investment between the two countries. Mr. Hun Sen invited Turkish investors to invest in processing units in Cambodia by creating a network to purchase produce from Cambodian farmers and build storage facilities to boost export to Türkiye and other countries. “The Kingdom of Cambodia and the Republic of Türkiye will strengthen the already-signed cooperation agreements and expand their bilateral cooperation to many other potential sectors,” Cambodian state-run AKP News reported.
Source：Khmer Time
13 January 2023
Cambodia’s GDP to grow at 6% in 2023, says NBC
The National Bank of Cambodia (NBC) has forecasted that the country’s Gross Domestic Product (GDP) is expected to grow around 6 percent in 2023, said the latest report released by NBC. The growth would be supported by garment and non-garment manufacturing products that are estimated to grow by 6.9 percent and 14.3 percent respectively. The Macroeconomic and Banking Sector Development in 2022 and Outlook for 2023 released on Wednesday by NBC shows that the agriculture sector is forecasted to further rise by 1.1 percent on the back of the implementation of the Regional Comprehensive Economic Partnership Agreement (RCEP) and bilateral free trade agreement (FTAs) between Cambodia and other countries such as China and South Korea. The report also indicates that the tourism sector is estimated to grow by 18.5 percent thanks to the increase in local and international tourist arrivals, while the construction and real estate sectors are expected to continue experiencing slower growth at 1.7 percent and 1.2 percent respectively.
Source：Khmer Time
13 January 2023
Exports to the US up 20% but declined 18% to China in 2022
The US continued to be the biggest export destination of Cambodia in 2022 as the Kingdom shipped goods worth $8.9 billion to the country, 19.7 percent more than in 2021. However, Cambodia’s exports to China with $1.2 billion last year showed a 17.9 percent decline for the same period. While the US share in the total exports of Cambodia stood at 39.9 percent, China’s share recorded 5.5 percent in 2022, trade data released by Cambodia’s General Department of Customs and Excise (GDCE) recently showed. In fact, the data showed that Vietnam was the second biggest export destination of Cambodia with $2.16 billion last year as the shipment of goods to the country showed a growth of 9.2 percent. China was the third biggest export destination for the Kingdom in 2022 while Japan was the fourth with $1.17 billion.
Source：Khmer Time
