Coke betting big on Cambodia
Coke betting big on Cambodia
Coca-Cola held the ground-breaking ceremony for its new $100 million production facility at the Phnom Penh Special Economic Zone yesterday, which when completed in 2016 will double the beverage behemoth’s Cambodian output over the next six years.
The new facility, which was announced last November after a meeting between Prime Minister Hun Sen and Coca-Cola’s regional representatives, will be completed by July 2016 and will add around 300 employees to Coke’s existing payroll of 650 workers.
David Wigglesworth, general manager of Cambodia Beverage Company, Coca-Cola’s local subsidiary, said choosing the economic zone to set up a factory was a “smart decision”, given the existing infrastructure.
“It supplies electricity, stable water and an environment of similar people, logistics, railways and access to the highway,” Wigglesworth said.
“So all in all, it offered everything that we needed to expand in the future.”
According to Wigglesworth, once the company ramps up production over the next few years they could look at exporting products to other countries in the region.
Coke’s new investment will hopefully lead other companies to explore the Cambodia’s potential as a growth market, said Julie Chung, charge d’affaires at the US Embassy in Cambodia.
“Many companies are going to be looking and comparing between Cambodia and other countries in the region, we hope that they take a closer look at Cambodia,” Chung said.
While Cambodia’s robust economic growth and rising skilled labour force were good signs for the country, Chung said, more work was needed to strengthen skills training and competitiveness.
“That is why education, English, and more professional skills will be essential in attracting more companies to come,” she added.
Sok Chenda Sophea, secretary-general at the Council for the Development of Cambodia, said that Coca-Cola’s expansion demonstrated that their initial plunge into the Kingdom had been a successful one.
“And for me, expansion means a lot, as compared to a new factory,” said Chenda. “[With] somebody that expands, it means they like the place.”
While American investments in Cambodia have been few when compared to Asian investors from countries like China and South Korea, Chenda attributed this to a lack of US interest in the garment sector.
However, with the diversification of the economy, he said, the US will be able to lend its technical know-how to more sophisticated industries, like the agro-industrial sector.
Lim Chhiv Ho, chairwoman of Phnom Penh Special Economic Zone (PPSEZ), said that while her company welcomed the new investment, it would also importantly create more jobs for Cambodians.
“I hope that, in the future, more American factories will come to invest in Cambodia because Cambodia’s political situation is very good for investment,” she said.
Meanwhile, PPSEZ, which is slated to go public on the Cambodia Securities Exchange (CSX) sometime later this year, was granted “in principle approval” for their listing eligibility on Tuesday from the CSX.
In the next step of the process, the firm will await approval from the Security and Exchange Commission of Cambodia for their IPO.
PPSEZ currently has 77 companies onsite, with Japanese electronics manufacturer Minebea also in the process of expanding its current factory in the economic zone.
