2024 sees dip in business start-ups
2024 sees dip in business start-ups
In the first 11 months of 2024, new business registrations dipped almost a fifth compared to the same period in 2023. Meanwhile, the number of business closures in the first 11 months of this year marked close to a 30 percent increase compared to the same period last year.
Despite the relative slowdown in new registrations and rising closures, a strong rise in incoming investment projects into the market suggests that 2025 will likely improve conditions for new company start-ups in the Kingdom.
According to data recently released by the Ministry of Commerce (MoC), 9,530 new company registrations were accepted by the authority in the first 11 months of 2024.
This figure represents a decline of around 17 percent compared to the same period last year.
In the same period, company closures totalled 1,284, rising by close to 33 percent compared to the same period in 2023.
In terms of business types being registered in 2024, private enterprises and foreign commercial company registrations experienced the most defined slowdown, with joint venture and capital companies demonstrating more stability and even growth in registrations compared to 2023 records.
In terms of 2024’s new business registrations, private enterprises saw the most substantial drop-off compared to the previous year, decreasing by around 32 percent.
Similarly, the number of foreign commercial company registrations decreased by around 17 percen
New capital companies registered in the first 11 months however increased by 8 percent, totalling 4,725 new business registrations in the sector.
Meanwhile, joint venture type company registrations remained stable compared to previous periods.
The year 2024 has also seen companies increasingly seeking financial support, according to the MoC data.
Applications for capital reserves increased by around 10 percent in the first 11 months of the year, with 6,532 businesses seeking financial support.
However, despite an overall increase, individual enterprises saw reserve capital applications drop by around 33 percent, totalling 5,321.
Although business registrations saw a slight dip thus far this year, positive growth in incoming investment projects suggests 2025 will see a boost in new startups.
The Cambodia Development Council (CDC) approved 414 investment projects in 2024, with a total investment of almost $7 billion, an increase of almost $2 billion compared to the previous year.
The 414 investment projects mark an increase of 54 percent, or 146 projects, compared to the prior year, which saw a total of only 268 projects.
The total investment of the 414 projects was approximately $6.9 billion, a 40 percent increase from the $4.92 billion recorded in 2023.
As stated by Sun Chanthol, Deputy Prime Minister and First Vice Chairman of the Council for the Development of Cambodia (CDC), in meeting of the Coordinating Committee for the Government-Private Sector Forum (G-PSF) last week, “Cambodia’s investment climate is experiencing significant growth in 2024, with positive opportunities and trends anticipated for the coming years.”
Alongside positive growth in incoming investment projects, gross domestic product (GDP) growth for 2025 has been forecasted at 6.3 percent, according the government’s projections recently revealed in the 2025 budget.
This growth is expected to be fueled primarily by an 8.6 percent increase in the industrial sector, a 5.6 percent increase in the services sector, and a 1.1 percent boost in the agriculture sector.
In total, Cambodia’s GDP is expected to reach about $51.39 billion next year, and its GDP per capita of $2,429. Meanwhile, inflation is projected at 2.5 percent.
