Japanese investment fuelling diversification, CDC chief says
Japanese investment fuelling diversification, CDC chief says
Investments by Japanese enterprises in non-textile areas of manufacturing have played an important role in diversifying the Kingdom’s economy, according to the head of the Council for the Development of Cambodia (CDC).
CDC secretary-general Sok Chenda Sophea made the remarks at the 23rd Meeting of the Cambodia-Japan Joint Committee on February 18.
The bilateral meeting was part of an investment maintenance mechanism that had been set up in 2009 under the umbrella of the Cambodia-Japan Agreement on the Liberalisation, Promotion and Protection of Investment, signed by Prime Minister Hun Sen and then-Japanese Prime Minister Shinzo Abe in 2007.
Between its inception in 1994 and the end of last month, the CDC approved 147 Japanese qualified investment projects (QIP) – or those that receive final registration certificates – with total registered capital of $2.9 billion.
“The new investment law is emerging as another strong legal standard with which Cambodia can attract investment, especially from Japan. This will help accelerate economic recovery after the Covid-19 crisis,” Chenda Sophea said.
At a public forum on macroeconomic management and the 2022 Law on Financial Management on February 18, the CDC chief confirmed that better than expected performance in the manufacturing sector saw its total value-added increase by eight per cent – far exceeding the target of 4.6 per cent.
He also echoed Ministry of Economy and Finance permanent Secretary of State Vongsey Vissoth’s claims that expansion of the manufacturing industry had helped to boost economic growth to three per cent in 2021.
Cambodia Chamber of Commerce vice-president Lim Heng told The Post that Japanese investment in the Kingdom has continued to grow despite both countries being hit hard by the Covid-19 crisis.
He said that many Japanese companies have been investing in Cambodia’s special economic zones (SEZ) as of late, especially in Phnom Penh and Koh Kong province. He added that they have been investing in a wide variety of non-garment manufacturing industries, which he said helps both investment and the Cambodian economy remain “more stable” than the garment sector.
“With the attention of the Royal Government of Cambodia, as well as trade and investment facilitation from the economy ministry and the CDC, we expect Japan to continue to invest in other sectors in Cambodia, besides the manufacturing industry,” he said.
Japanese ambassador to Cambodia Masahiro Mikami said ministries and institutions in the Kingdom have historically made great efforts to coordinate and respond to Japanese investors’ concerns and requests, which he noted have been highly reassuring for them.
“It is imperative to continue the good cooperation between Cambodian state institutions and Japanese investors to achieve success in business and investment activities in Cambodia, which will serve as a positive message to attract more Japanese investors to invest in Cambodia,” he said.
Figures from the Ministry of Commerce show that bilateral trade volume between Cambodia and Japan reached $1.7 billion in 2021, an increase of 0.49 per cent from $1.692 billion in 2020.
Last year, Cambodian exports to Japan stood at $1.094 billion – an increase of 3.61 per cent from a year earlier – while imports amounted to $607 million, down 4.68 per cent year-on-year.
