Challenges apart, construction sector gets $4.3 billion investments
Challenges apart, construction sector gets $4.3 billion investments
Cambodia attracted $4.3 billion of investment capital from the construction sector in 2024, down 15 percent compared to last year, according to the annual report from the Ministry of Land Management, Urban Planning and Construction (MLMUPC), released on Monday.
In 2024, 2,633 investment projects in the construction sector nationwide were approved, with a total area of more than 10 million square meters and an estimated investment value of $4.33 billion, the report said.
The number of investment projects, investment capital and construction areas approved in 2024 decreased by 15.17 percent compared to 2023, when there were 2,924 investment projects.
In 2023, the projects covered an area of more than 12 million square meters with a total investment capital of $5.1 billion.
Speaking at the ‘Meeting to Review the Work Results in 2024 and the Work Direction for 2025 of MLMUPC’ on Monday, Deputy Prime Minister Say Samal, Minister of MLMUPC, said that during the first year of the seventh mandate, the ministry has been effectively responding to the Royal Government’s first Pentagonal Strategy and the five key priority policies set out by Prime Minister Hun Manet.
Samal pledged to achieve the vision of the Royal Government to become a high-middle-income country by 2030 and a high-income country by 2050.
The ministry will prepare development plans for various areas in Cambodia to be suitable as a middle-income and high-income country and worthy of the name ‘Cambodia My Homeland’ by organizing whether rural or urban to have social orders, schools, hospitals, infrastructure, water, electricity and roads, he said.
Additionally, the ministry will transform the city into an attractive destination with 24-hour walking people, and prepare it to become a civilized city not only by attracting locals but also by attracting more and more foreigners to visit Cambodia, Samal added.
“The ministry has achieved many important achievements in line with the long-term, and realistic vision of the Royal Government,” he said.
“In addition to ensuring political security and economic security, ending the current controversy in society as a whole, the ministry’s next task is to achieve the vision of Cambodia 2050 to become a high-income country. This is the time we need to turn to the core work of the ministry, which is rooted in the third, fourth and fifth battles (referring to important tasks) and subsequent work to serve the Cambodian people.”
Noun Rithy, Chairman of the Board of KFA Group and one of the real estate developers in Cambodia told Khmer Times that although the construction sector in 2024 compared to 2023 has slowed slightly, it is better than before because the investment lately has the right approach and clear goals to capture market share.
The shift reflects that the construction sector is more mature and more robust after going through many problems such as global economic uncertainty, Covid-19 crisis and the prolonged war crisis abroad, which has negatively affected the economy, he added.
“At present, despite the Russia-Ukraine war and global economic crumble, the construction sector in Cambodia continues to move forward, with $4.3 billion invested in the sector, which is a good sign for the economy as a whole,” Rithy said.
He observed that Borey housing projects are currently declining in terms of construction permit applications, but there is an increase in commercial buildings, factory buildings, hospital, and school construction projects, which are more than 9 to 10 storeys.
As the crises continued to drag on the economy, real estate buying and renting declined, especially on high-end housing, and the supply of above-affordable and high-end housing exceeded market demand, but there is a room to grow and demand for affordable and medium-price housing, Rithy said, adding that therefore, this type of market should be considered for investment to meet customer needs.
“In order to boost the construction sector to be stronger, the government should clearly divide the development zones, and promote the tourism sector, because it is a sector that contributes to strong economic growth,” Rithy said.
“In Sihanoukville, for example, there are unfinished construction projects, so the government should cooperate with the private sector to promote the completion of construction to beautify the city and to address the impact in the sector.”
Rithy suggested the government should waive visas for tourists, as it benefits the economy as much as it benefits flights, accommodation and transportation.
