Investment Hightlights
Cambodia Weekly Financial News September 25~29, 2023
2023-09-30View Times｜ 1124
Cambodia Weekly Financial News
September 25~29, 2023
25 September 2023
PM pitches Cambodia before US investors
The Cambodian government has made a strong pitch to attract US investors, promising support for starting as well as expanding businesses and becoming key partners of the government in its development efforts. “US investors will see investment opportunities and learn more about the economic potential in Cambodia,” the Prime Minister said. “Cambodia continues to expand its market size by integrating into the global supply and value chain through bilateral and multilateral free trade agreements such as the ASEAN Free Trade Agreement, the Cambodia-China Free Trade Agreement, the Cambodia-Korea Free Trade Agreement, and the Regional Comprehensive Economic Partnership (RCEP),” he said. US direct investment in Cambodia, however, is still low, despite the US being one of the largest sources of investment in the world. In Cambodia, the volume of direct investment from the US increased from $225 million in 2010 to $893 million in 2022.
Source : Khmer Time
25 September 2023
Increased loan access for SMEs
Three private institutions have come together to provide loans to small and medium enterprises (SMEs) to boost financial access for the business expansion and sustainability amid the global economic downturn. “The partnership between CGCC, FASMEC and Wing Bank demonstrates a shared commitment to promoting economic growth and development in Cambodia. By working together, the three organizations would help SMEs overcome financing challenges and unlock their potential including improving financial literacy to drive economic growth in the country,” CGCC mentioned. Meanwhile, CGCC’s Wong remarked that the partnership would enable CGCC to reach out to more SMEs in its outreach programs, where nationwide workshops are conducted on SME development. “[The workshops] are part of our long-term goals to improve the growth of SMEs”. The CGCC was established on September 1, 2020. Its $200 million Business Recovery Guarantee Scheme (BRGS) was launched on March 29, 2021 in a bid to widen access to formal loans from participating financial institutions for working capital, investment and business expansions.
Source : Phnom Penh Post
26 September 2023
Aegies Fund Management Plc. held a press conference
under the high presidency of HE Sou Socheat
On September 26, 2023, Aegies Fund Management Plc., Held a press conference of Aegies CIS Fund to introduce its upcoming Collective Investment Scheme (CIS) at Hyatt Regency Phnom Penh. Under the high presidency of HE Sou Socheat, Royal Government Delegate in charge of the Director General of the Securities and Exchange Regulator of Cambodia. About 100 distinguished guests, including representatives from major banks, public administration institutions, accounting firms, law firms and other strategic partners, were invited to witness this important opportunity to participate in the development of Cambodia's securities market. CIS Funds can create better and safer return on investment for investors in line with the principle of sharing benefits and risks. In 2019, AEGIES FUND MANAGEMENT PLC. Listed in Cambodia and licensed by SERC on August 16, 2021. AEGIES is a leading independent asset management company. With her extensive experience in fund management over the years, the CEO of Aegies, Dr. Sarah Hsu has demonstrated her confidence in providing the highest standard CIS fund investment services to investors in Cambodia and around the World.
Source : Sabay News
26 September 2023
Pepper exports decline 30% Jan-Aug
Cambodia has experienced a 30 per cent decline in pepper exports in the first eight months of 2023, exporting over 5,000 tons, compared to the same period in 2022, according to the Ministry of Agriculture, Forestry and Fisheries. Mak Ny, president of the Cambodia Pepper and Spice Federation (CPSF), highlighted that the market price has decreased, prompting some farmers to stock their goods for later sale. “The hot weather and lack of irrigation water made many plants die,” he said, noting that exploring new markets has been deemed vital to attract more investors to support, grow and export the product. “In ASEAN, Vietnam is a big market for Cambodian pepper. However, the Kingdom still faces tariff barriers and hygiene issues despite some regional and bilateral free trade agreements,” he added.
Source : Phnom Penh Post
26 September 2023
New investment law entices Hong Kong investors
Hong Kong investors are keen to explore investment opportunities in Cambodia and have pledged to introduce business potentials created by Cambodia’s new investment law and its sub-decrees to their colleagues back home. The investors are also planning to arrange a business trip for prospective Hong Kong investors to Cambodia soon, said Parsom Lam, director of the Hong Kong Economic and Trade Office (HKETO) in Bangkok on September 25. Un Voanra urged them to learn more about the investment climate, potential and investment opportunities in Cambodia and seek cooperation points with the CDC. He explained that Cambodia’s new investment law is a new legal instrument that is open, transparent and predictable, and offers a smart incentive regime that is favorable for investment. Data from the General Department of Customs and Excise of Cambodia showed that in 2022, exports and imports between Cambodia and Hong Kong totalled $946.3 million, down 1.3 per cent from 2021. Cambodian exports to Hong Kong dropped 22.2 percent to $182 million, whereas imports from Hong Kong amounted to $764.3 million, an increase of 5.5 per cent.
Source : Phnom Penh Post
26 September 2023
ADB lends $140M for labor development
Cambodia has received $140 million in loans from the Asian Development Bank (ADB) to boost labor development to transform the country into a technology-driven, knowledge-based industrial economy while enhancing public service delivery by local administrations through public finance and decentralization reforms. “Under the Skills for the Future Economy Sector Development Programme, the multilateral development bank lends Cambodia $100 million [$20 million policy-based loan and $80 million investment project] to help transform the country into a technology-driven, knowledge-based industrial economy,” it mentioned. It would also enhance the country’s skills development ecosystem, promote industry-led inclusive training for upskilling and reskilling workers in priority areas, and expand financing from the private sector through a cost-sharing, demand-based training model under a skills development fund that the government has successfully piloted. According to the Ministry of Economy and Finance, the agreement emphasizes the cooperation, support and the trust by ADB on the government as the programme respond effectively towards the Pentagonal Strategy.
Source : The Phnom Penh Post
27 September 2023
Top 3 to win the Creative Cambodian Convenience Store Business Plan Competition of High-Tek Financial (Cambodia) Co., LTD.
On September 27, 2023, High-Tek Financial (Cambodia) held an awards ceremony and present the final presentation of the Cambodia Shopping Business Innovation Competition to the winning team. Cash prizes as well as the opportunity to become an entrepreneurial partner of the company in the future cooperation of the company on the Convenience Store business in Cambodia. The Organizing Committee strongly hopes that young Cambodians will gain valuable learning experience from a comprehensive mentoring mechanism that connects them with entrepreneurial resources and fosters innovative thinking on their entrepreneurial skills. The 10 winning teams will be given the opportunity to be interviewed by the management of the company, will have the opportunity to work with High-Tek Financial (Cambodia) through internships, employment, or can become the partner of the Convenience business project. High-Tek (Financial) Co., Ltd. believe that Convenience Store Businesses are a successful place for achieving integration where everyone in society enjoys being creative as well as having equal resources and opportunities to sell merchandise. This is the main idea behind why High-Tek Financial organizers are organizing this competition.
Source : Sabay News
27 September 2023
Share prices fall amid three listings expected by year-end
Share prices of companies listed on Cambodia’s stock exchange have mostly declined as the movement of selling shares by investors on the supply side has increased faster than the movement of share buying shares by those on the demand side, but it is expected that three new companies will be listed on the bourse in the last quarter of 2023, said a senior official. Kim Sophanita, Director of CSX’s Market Operations Department, told Khmer Times on Monday that the share price of stocks on both main and growth boards have fallen between 1.33 percent and 26.89 percent during the third quarter of this year, while the share price of the Pestech (Cambodia) Plc (PEPC) and Phnom Penh Water Supply Authority (PWSA) have dropped fastest and slowest by 14.14 percent and 1.33 percent respectively on the main board. “In general, the reason for the share price to go down is due to external factors such as the increased interest rates, inflation, and other unfavourable geopolitical and global economic conditions” said Sophanita. “We believe that with more product offerings in the market, it allows for better liquidity and better-diversified portfolio for the investors and they will eventually serve to grow the market in the long term,” said Sophanita.
Source : Khmer Times
27 September 2023
Exports to Singapore record 6.5-fold rise from Jan-Aug
Exports to Singapore in the first eight months of 2023 rose over 6.5 times to $476.9 million from $72.8 million in the corresponding period in 2022, as bilateral trade fell 62.8 per cent to $1.1 billion due to lower imports from Singapore, according to the General Department of Customs and Excise of Cambodia (GDCE). For August 2023, trade between the two countries totalled $211.4 million, down 40.3 per cent from August 2022, with Cambodia’s exports to Singapore up 556.4 per cent at $28.9 million while imports from Singapore dropped 47.8 per cent to $182.6 million. “The Regional Comprehensive Economic Partnership Agreement, in which Cambodia and Singapore are signatories, and the Double Taxation Agreement implementation has streamlined the flow of goods between both countries. Cambodian agricultural products are expected to have a bigger presence in Singapore, as well as in international markets,” he said. As of June 30, last year, the Council for the Development of Cambodia (CDC) reported a total of $39 billion in foreign direct investment (FDI) in Cambodia, with an average annual growth rate of 9.6 per cent. Singapore, the fourth largest investor in Cambodia, with $2.4 billion, accounted for 6.4 per cent of FDI at the time.
Source : Phnom Penh Post
27 September 2023
Thai PM’s visit to boost bilateral trade
Cambodia-Thai business communities hope that bilateral trade and investment between the neighbors grow stronger, as Thailand’s newly-appointed Prime Minister visited Cambodia as his first country in ASEAN. “Both prime ministers will hold bilateral talks aimed at charting a course of action to further deepen and expand the extensive spectrum of mutually beneficial ties under bilateral and multilateral framework,” MFAIC said. The close relationship between the leaders would increase the confidence in Thai and Cambodian businessmen and investors to expand further in each other’s countries. “Once large Thai companies including CP Group and GTC Group expand their business in Cambodia, it would spark other businesses, particularly small and medium enterprises in Thailand to consider coming to Cambodia. I strongly believe that the new governments will ensure that bilateral trade hits $15 billion soon, which was a pledge made by the former prime ministers,” Jiranun said. Cambodia’s exports to Thailand reached $480.2 million, up 9.5 per cent year-on-year, while imports dropped 14.4 per cent to $1.2 billion, narrowing Cambodia’s trade deficit with Thailand by 24.9 per cent on an annual basis to $744.5 million.
Source : Phnom Penh Post
28 September 2023
GDT responds to public concerns on tax policies
The General Department of Taxation (GDT) on Tuesday issued a clarification in response to the comments made by the public on social media regarding its tax revenue management in a bid to prevent any form of confusion on the government’s efforts in maintaining macroeconomic stability. According to GDT, the public has commented on two main points including charging taxes on capital gain and general taxation such as a comparison of Cambodia’s taxation to that of other countries, increasing taxes on airports for passengers and tourists, falling prices of agricultural products due to charging taxes and recalling previous tax events. GDT also clarified that the RGC has delayed the implementation of the tax on capital gain for physical persons three times. The RGC has also released tax incentives for many economic sectors such as qualified investment projects (QIP), securities, finance, agriculture, education, tourism, construction and real estate. The GDT’s statement also clarified that the comments specifying that one percent is taxed on borrowers of banks are also untrue as the Law on Taxation does not stipulate the requirement of charging one percent tax on the loans that banks approved for their borrowers and the types of taxes on airports.
Source : Khmer Times
28 September 2023
Cambodia is among 10 countries where $1.95 billion of the
total foreign investment by major Chinese power companies went
The 24th Conference on the Electric Power Supply Industry (CEPSI) will take place in Xiamen, Fujian province, from October 19 to 23, said China Electricity Council on Tuesday, co-organizer of the conference together with the Association of the Electricity Supply Industry of East Asia. Actual investment in the projects, which cover 10 countries and regions including Pakistan, Cambodia, Uzbekistan, Indonesia, and Vietnam, reached about $1.95 billion, accounting for 57.7 percent of the total foreign investment by major Chinese power companies last year. Chinese power companies are increasingly focusing on renewable energy projects such as solar and wind power globally, with major companies so far having invested in and constructed 16 power projects in markets participating in the Belt and Road Initiative, accounting for 66.7 percent of their total foreign power investment projects, the council said earlier.
Source : Khmer Times
28 September 2023
Explore untapped potential, CCC urge regional businesses
Cambodia Chamber of Commerce (CCC) president Kith Meng has urged the business community in the Mekong region to take advantage of Cambodia’s abundant business and investment potential, as well as its multitude of bilateral and multilateral free trade agreements. Speaking at the ASEAN-Cambodia Business Summit on September 28 in Phnom Penh, Kith Meng said the Mekong region is home to more than 200 million people and has high potential for growth. The countries in the region share a similar culture, enjoy strong friendship and great cooperation amid advantages on resources and industrial structure. In an interview with The Post on July 23, Ministry of Commerce secretary of state Penn Sovicheat noted that the decline in Cambodia-ASEAN trade volume is a result of lower regional and global demand, mainly driven by the Russo-Ukrainian war. The volume of goods exchanged between Cambodia and the nine ASEAN states in the first half of 2023 reached $7.1 billion, down 17.2 per cent year-on-year, according to the General Department of Customs and Excise of Cambodia.
Source : Phnom Penh Post
29 September 2023
Cambodia urged to diversify exports into services sector
The European Chamber of Commerce (EuroCham) yesterday urged the new government in Cambodia to take steps to diversify its exports into services, as the country’s over-reliance on a few export sectors, such as garments, can make it susceptible to changes in global demand, trade policies and market competition. Accordingly, the White Book recommended that the Royal Government of Cambodia facilitate the emergence of new service exports, including in areas such as human resources, accounting, medical, dentistry, and IT, by pushing for the implementation of service liberalization commitments among RCEP signatories. Failure to diversify into services may result in a lack of investment in the country’s digital infrastructure and hinder its ability to attract foreign investment. Cambodia’s current challenges in processing times are reflected in the country’s international logistical rankings. The World Bank’s 2022 Logistics Performance Index saw Cambodia lag behind Thailand, Vietnam and Lao PDR on two key indicators – efficiency of Customs clearance processes and frequency with which shipments reach the consignee within scheduled or expected time, with scores of 2.2 and 2.7, respectively (value from one to five, with five being the highest).
Source : Khmer Times
29 September 2023
Rubber exports surge 55% amid price fall, says GDCE
Despite the fall in the prices of natural rubber, Cambodia earned $479.39 million from the exports of rubber articles in the January to August period of 2023, an increase of 55.3 percent compared to the same period last year. The latest trade data of the General Department of Customs and Excise (GDCE) showed that for August 2023 alone, Cambodia earned $94.16 million from rubber exports, an increase of 139.6 percent compared to $39.31 million in August 2022. As a result of these and the subsequent dip in demand, the price of rubber fell by nearly 15 percent in the international market. In fact, for the first eight months, the average price of rubber in Cambodia was only $1,327 per ton, down $ 230 per ton from the same period last year, reports revealed. According to the Ministry of Agriculture, Forestry and Fisheries, in 2021, Cambodia has more than 400,000 hectares of rubber plantations. Cambodia also has 168 rubber processing factories and handicraft centers in 11 provinces.
Source : Khmer Times
