Kingdom sees 9% rise in factory numbers
Kingdom sees 9% rise in factory numbers
Cambodia’s manufacturing sector is experiencing robust growth with the number of factories reaching a new high of 2,175 as of June this year.
This showed a significant increase of 178 factories, or 8.9 percent, compared to the 1,997 factories recorded as of June last year, according to the biannual report of the National Bank of Cambodia.
The factory landscape has had a substantial impact on the Cambodian job market, a key driver of economic growth and poverty reduction in the country.
“The manufacturing factories employ some 1.1 million locals,” the report said.
The increasing number of factories signified the surge in the export of garments, footwear and travel goods (GFTs) and an increase in foreign direct investments. Most of the GFT products are exported to the EU, the US, Canada, the UK and RCEP countries.
A report from the Ministry of Commerce (MoC) showed that Cambodia exported $6.24 billion worth of GFT products in the first half of 2024, up 16.5 percent from $5.36 billion recorded in the same period last year.
The GFT industry is the largest foreign exchange earner for the country. The sector currently consists of about 1,538 factories and branches, employing approximately 913,000 workers, mostly female, according to the Ministry of Labour and Vocational Training.
The government’s pro-investment policies, coupled with the country’s strategic geographic location and relatively low labour costs, have attracted a growing number of foreign investors, said Lim Heng, Vice President of the Cambodia Chamber of Commerce.
Free trade agreements with China and Korea and the mega trade agreement RCEP have helped in attracting new investment to the country, Heng said.
“The increasing investment showed that Cambodia is a potential destination for both domestic and foreign investors,” Heng told Khmer Times.
According to the central bank, the manufacturing sector is one of the key economic drivers.
“In industrial sector, increasing external demand, especially economic growth of Cambodia’s trade partners such as the US and the EU has helped the recovery of the garment industry while the non-garment manufacturing sector is also expected to see a growth due to the trade agreements that Cambodia has,” the central bank said in the report.
