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China retains top spot for FDI source in Jan-Apr with 73.5% contribution

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View of tall buildings from a distance in Phnom Penh on May 21. Hong Menea

China retains top spot for FDI source in Jan-Apr with 73.5% contribution

China remained the top source of new FDI (foreign direct investment) pledges into Cambodia in the first four months of the year, contributing 73.5 per cent of the total registered capital, according to senior investment official Chea Vuthy.

This has been interpreted as an indicator of Chinese investors’ confidence and, perhaps more crucially, as a step toward export diversification.

Vuthy, deputy secretary-general of the Council for the Development of Cambodia (CDC), shared a number of pertinent statistics at the “Cambodia-China Business Leaders’ Summit” on May 19.

According to him, the CDC approved 65 investment projects between January and April with total paid-up capital of $588 million, of which China accounted for about 60 per cent, or equivalent to 73.5 per cent of FDI stock.

By comparison, the council greenlit 186 new investment projects and expansions totalling $4 billion in paid-up capital in 2022, of which China represented 42 per cent, corresponding to 90.5 per cent of FDI stock, he said.

“These figures unambiguously demonstrate that FDI, particularly from China, has been crucial to Cambodia’s economic development and the improvement of the lives of its citizens through, inter alia, the inflow of investment capital, export diversification and growth, increases in state revenues, technology transfer, skill development, the establishment of industry clusters, capacity building of local businesses, and promotion of connectivity as well as integration into global value chains.

“Considering the aforementioned cooperation and the Kingdom’s improving investment climate, the flow of direct investment from China underscores the high confidence that Chinese investors place in Cambodia,” Vuthy said.

At the same event, Global Economic Development Forum (GEDF) chairman Gui Hanfeng emphasised that strong economic complementarity exists between Cambodia and China, adding that the two countries have established a solid base for collaboration in areas like cultural tourism, agriculture, manufacturing and infrastructure.

Cambodia has a great deal of room to grow and develop in a variety of domains, he said, stating that participants are at the summit to learn, share, and look for ways to better integrate with the Kingdom’s industrial development.

The two countries have long had amicable relations, are close neighbours, and share a common brotherhood, Gui said.

“We live in an era full of opportunities and challenges. China and Cambodia have been cooperating more closely in recent years in terms of cultural and economic exchanges, and they have made important advancements … [that] have promoted greater mutual understanding and friendship between the two peoples,” he said.

He affirmed that the GEDF is keen to make the most of its position and advantages in terms of global resource links and to step up its cooperation with the Cambodian government and businesses.

According to Gui, this will help foster cross-cultural interchange, trade and economic cooperation, market information exchange, investment platforms, talent development, and the introduction of cutting-edge technologies, all of which he claims will positively influence Cambodia’s economy development.

Vuthy outlined a few of the Kingdom’s comparative advantages for luring investors, including a strategic location, high degree of peace, competitive workforce, plenty of resources for export-oriented processing, free trade agreements (FTA) and preferential trade access to ASEAN, China, Japan, Europe, the US and other major markets.


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