South Korean investors eye automotive expansion
South Korean investors eye automotive expansion
South Korean investors have shown a strong interest in expanding their investment in the automotive sector, according to the Council for the Development of Cambodia (CDC).
To address this, the council proposed the creation of an industrial cluster complex tailored to meet the requirements of relevant enterprises.
Suon Sophal, deputy secretary-general of the Cambodian Investment Board (CIB) at the CDC, met recently with representatives from Korea-based CAMKO Infracore Co Ltd to discuss the benefits and incentives of increasing investment in the sector.
According to the CDC, Sophal thanked the Korean delegation for their interest in continuing to develop the production chain in Cambodia, following their previous “successful and productive” projects.
He also highlighted the role of the Korea Desk, emphasising its commitment to providing Korean investors with professional, confident coordination and private investment services.
“We have incentive packages for investment projects, including those for expanding qualified investment in Cambodia. Our focus has primarily been on additional and special incentives,” he said.
He suggested that the representatives consider the establishment of a Cambodia-Korea special economic zone (SEZ), transforming it into an industrial complex to meet the needs of relevant enterprises.
Tan Monivann, president of the Cambodia Automotive Industry Federation (CAIF), said on January 10 that Korea is among the world's fastest-growing automotive industries, producing a diverse range of automobiles, machinery, smartphones and electronics.
He said that in a previous meeting, the CAIF had urged the government to offer tax incentives to domestic vehicle manufacturers, including both local and foreign investors, to encourage investment in the country’s automotive industry.
“For Cambodia, the automotive sector is an important revenue generator for the state. Offering excessive tax preferences could impact state revenue. Therefore, investment from an advanced country like Korea in our automotive sector is highly advantageous,” he explained.
Hong Vanak, an economics researcher at the Royal Academy of Cambodia, noted that while the interest of foreign investors like Korea is positive news, the country also needs to focus on developing its human resources to meet their demands.
“The skilled workforce is crucial. The lack thereof might deter investment. I commend the government's policy to provide training to approximately 1.5 million young people from poor and vulnerable households at state institutions, free of tuition fees and even with a monthly allowance,” he stated.
“I anticipate that in the near future, we will have a sufficiently skilled workforce to meet the demands of the automotive sector,” he added.
Korea is among Cambodia’s largest trade partners, with investments spanning multiple sectors including finance, real estate, manufacturing, agriculture, hotels and restaurants, hydropower and construction, as per the CDC.
