INVESTING IN CAMBODIA · REASONS TO INVEST IN CAMBODIA • Macroeconomic Stability • Pro-business...
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INVESTING IN CAMBODIA CHANTHOL SUN Senior Minister, Minister of Commerce Vice Chairman Council for the Development of Cambodia 1
Transcript of INVESTING IN CAMBODIA · REASONS TO INVEST IN CAMBODIA • Macroeconomic Stability • Pro-business...
INVESTING INCAMBODIA
CHANTHOL SUNSenior Minister, Minister of CommerceVice ChairmanCouncil for the Development of Cambodia
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STRATEGIC LOCATIONIN SOUTH-EAST ASIA
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CAMBODIA AT A GLANCE
181 035
LAND AREA
POPULATION
181,035square kilometer
14.7million(at 2013)(at 2013)
POPULATION GDP growth : average 7 6% per annum
1.46
POPULATION GROWTH RATE
Stable macroeconomic environment GDP growth : average 7.6% per annumthe last 10 years (2005–2014 periods)
GDP per capita
$1 220Exchange rate US$ 1 Ri l 4 0491.46
%
at
$1,220 (2015: Projection by MEF)
US$ 1 = Riel 4,049(2015–H1, period average of )
DEBTB2at2013
Inflation rate 1.0%(2015–H1, period average)
DEBTRATINGB2
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REASONS TO INVEST IN CAMBODIA
• Macroeconomic Stability
• Pro-business Government
• Competitive Investment Incentives
• One-Stop Service Investment Promotion Agency
• Preferential Access to Regional & World Markets
• Investment Protection
• Efficient Infrastructure and Strategic Location
• Sound Financial Sector
• Abundant Resources, Labor, Land
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MACROECONOMIC STABILITY
• GDP growth averaged 7.6% per annum the last 10 years (2005 –2014)
• Projected GDP growth for 2015 is 6.9% (World Bank)
• Stable exchange rate
• Low inflation (3.9% in 2014 and 1% in the first half of 2015)
• Debt to GDP ratio 32.8% (at the end of 2013)
L b d t d fi it• Low budget deficit
• International reserves increased to US$ 3.6 billion (2013) and rose to US$ 4.4 billion (2014) – nearly 4 months of prospective imports( ) y
• International reserves reached US$ 4.7 billion in first half of 2015
• It took 12 years to increase international reserves from US$ 100 $million to US$ 1 billion (1994–2006) but it just took 2 years to
increase from US$ 2 billion to US$ 3 billion (2006–2008) 5
GROSS DOMESTIC PRODUCT (GDP)
13.3%14.0%
Real GDP Growth Rate (%)
8.8% 8 5%
10.3%10.8%
10.2%10.0%
12.0%
8.1%
6.6%
8.5%
6.7%6.0%
7.1% 7.3% 7.4% 7.1% 6.9%
6.0%
8.0%
2.0%
4.0%
0.1%0.0%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014Est.
2015Proj.
Growth slowied down in 2009 because of impacts from global financial crisisSource:MOP NIS and 2015 is projected figure of theWorld BankSource: MOP‐NIS and 2015 is projected figure of the World Bank
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GDP PER CAPITA GROWTH
1,400
GDP Per Capita (US$)
971 1,043
1,123
1,220
1 000
1,200
623
739 731
830 909
800
1,000
468 534
400
600
‐
200
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Est. 2015Proj.
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CURRENCY
4 250
Stable Exchange Rate (period average, Riels/US$)
4,143
4,189
4 150
4,200
4,250
4,097 4,107
4,060 4,058
,
4,062 4 038
4,050
4,100
4,150
4,033 4,027 4,038
,
4,000
4,050
3,900
3,950
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015Proj.
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INFLATION(PERIOD AVERAGE)
30%
Low Inflation
(PERIOD AVERAGE)
25.0%25%
15%
20%MEF Projection
for 2015
3 9%
6.3% 6.1%7.7%
4 0%5.5%
3 9%
10%
0.7% 1.4% 1.0%
3.9%
‐0.7%
4.0%2.9% 2.9%
3.9% 3.5%
0%
5%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
‐5%
Proj.
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FOREIGN RESERVES
6.0Foreign Reserves (US$ Billion)
US$ 4 4 billion by 2014 and
5.0
US$ 4.4 billion by 2014 and US$ 4.7 billion by mid‐2015.Proejcted to reach US$ 5.1 billion by the end of 2015 (MEF Projection)
3.0
4.0
2.0
0 0
1.0
0.02000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
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TRADE VOLUME (US$ MILLION)
16,409
18,024 20,000
Total Trade ExportImport Trade Balance
12,256
13,879
9 87910,616
15,000Import Trade Balance
6,828
8,464 9,521
8,898 8,080
9,681
5,0355,633
6,5307,408
4 7715,432 5,395 4 942
5,775 7,221
8,246
9,879 10,000
2,910 3,693
4,089 3,503 3,138
3,906 5,035
3,918 4,771 4,942
5,000
(1,008) (1,078) (1,343) (1,892) (1,804) (1,869)(2,186) (2,613)
(3,349) (3,208)(5 000)
‐2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
(3,349) ( , ) (5,000)
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BUDGET
8.4%9.0%
Low Budget Deficit (% of GDP)
6.0%
7.2%7.5% 7.5%
6.3% 6.2%6 0%
7.0%
8.0%MEF
Projection
5.4%
3.8%4.3% 4.1%
4.0%
5.0%
6.0%
2.7%3.3%
2.8% 2.8%
2.0%
3.0%
0.0%
1.0%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015Est. Proj.
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REMARKABLE ACHIEVEMENTS
Source: World Bank WDI 13
PRO-BUSINESS GOVERNMENT
Government and Private Sector Working Groups
G d i SGovernment and Private Sector Forum
Private sector is an engine of economic growth
Easy access to relevant government officials
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GOVERNMENT PRIVATE SECTOR FORUM
World Bank Group: Support of structured public - private dialogueWorld Bank Group: Support of structured public private dialogue for private and financial sector development, 4/2009
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COMPETITIVE INVESTMENT INCENTIVES
• Corporate tax - 20%
• Tax holiday up to 9 Years
• Full import and export duty exemption (QIP Projects)
• No discrimination, no nationalization
• No local participation requirement
• No price control on any products or services
No foreign exchange control• No foreign exchange control
• No restriction on capital repatriation: free repatriation of profits & free remittance of royalty, interest, loan repayment, dividend, investment capital etccapital, etc.
• No trade restrictions
• Long-term land lease g
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ONE-STOP SERVICE – CDC/CIB
Information and applicationInformation and applicationEvaluation and approval
Customs duty and tax exemptionVisa and work permitCompany registration
Investor after-careInvestor after-care
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ACCESS TO WORLD MARKETS
Access to the U.S. market - 1996
Access to the E.U. market - 1996
Member of the Association of South-East Asian Nations (ASEAN) - 1999
Member of the World Customs Organization (WCO) - 2001
Member of the World Trade Organization (WTO) 2004Member of the World Trade Organization (WTO) - 2004
Member of various regional trade agreements
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MFN/GSP MARKET ACCESS
o Australia
o Austria
o France
o Germanyo Poland
o Portugal
o Belarus
o Belgium
o Hungary
o Ireland
o Italy
o ROK
o Russian Federation
o Bulgaria
o Canada
o China
o Italy
o Korea
o Luxemburg
Federation
o Slovakia
o Spaino China
o Czech Republic
o Denmark
o Japan
o Netherlands
New Zealand
o Sweden
o Switzerland
o Finlando New Zealand
o Norwayo UK
o USA
MFN: Most Favored Nation GSP: Generalized System of Preferences 19
INVESTMENT PROTECTION AGREEMENTS
o Australia o Lao PDR
In process :o Algeria
B l io China P.R
o Croatia
Cuba
o Malaysia
o Netherlands
o OPEC
o Bulgaria
o Egypt
o Lybyao Cuba
o Czech Republic
o DPR of Korea
o OPIC
o Pakistan
o Lybya
o Myanmar
o Qatar
o Germany
o France
o Philippines
o ROK
o Singapore
o Russia
o Ukraine
o Indonesia
o Japan
K it
o Singapore
o Switzerland
o Thailand
o UK
o USA
Hungaryo Kuwait
o Vietnamo Hungary
o Malta20
INFRASTRUCTURE & LOCATION
• Completed ASEAN highway linking Thailand, Cambodia, Vietnam
• Completed ASEAN highway linking Cambodia, Lao PDR, ChinaCompleted ASEAN highway linking Cambodia, Lao PDR, China
• Finished upgrading national road network
• Rehabilitating National Railways as part of Singapore Kunming rail link• Rehabilitating National Railways as part of Singapore – Kunming rail link
• Upgraded Sihanoukville Port (new general cargo terminal)
U d d Ph P h P t / t i t• Upgraded Phnom Penh Port / new container port
• Upgraded Phnom Penh, Siem Reap, and Sihanoukville Airports
• Finalized installing fiber optic cable across the country
• Construction of new power plants
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ACCESS TO BORDER CROSSINGS
To Thailand• NR-48• NR-57• NR-62• NR-64• NR-68
To Vietnam• NR-2• NR-33• NR-72• NR-74• NR-78
* New Route No
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CAMBODIAN RAILWAY MAP
105km Serei Saophoan-Siem Reap
Propose new link
48Km Sisophon-Poipet
273km Snoul-Strung Treng to
239km Siem Reap-Skun
Propose new link
g gLaos Border.
Propose new link
338Km Phnom Penh-Sisophon
264km Phnom Penh-Sihanouk Ville 255km Bat Doeng-Loch Nich
(Vietnam Border).
Propose new link
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SPECIAL ECONOMIC ZONES
• 34 SEZs have been approved
• 11 SEZs are in operation
• 23 SEZs are being built
• Single Window for Import/Export Procedures
• Good Infrastructure
[ Photos: Phnom Penh Special Economic Zone ]
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Cambodia’s Special Economic Zones
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Invest in Cambodia and you have
14 7 million14.7 millioncustomers
Invest in Cambodia and you have
623 million customers at
your doorstep
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SOUND FINANCIAL SECTOR• 36 commercial banks (by the end of 2014)
a) 11 Foreign Branch Banks
b) 13 Locally Incorporatedb) 13 Locally Incorporated
c) 12 Subsidiary Banks
• 11 specialized banks (including the Rural Development Bank)40 licensed micro finance institutions• 40 licensed-micro-finance institutions(7 deposit-taking micro finance institutions)
• 33 registered-micro finance operators6 Non life insurance companies• 6 Non-life insurance companies
• 2 life insurance companies• 1 re-insurance company• Capital market laws• Financial leasing law
• Low NPL rate: 2 2% (2014) – down from 2 7% in 2013Low NPL rate: 2.2% (2014) down from 2.7% in 2013• Strong banking supervision - prudent reserve requirement level
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BANK DEPOSITS (US$ MILLION)
9 749
12,000
7,560
9,749
8,000
10,000
4 313
5,193
6,736
6,000
2,328 2,521
3,320
4,313
2 000
4,000
339 413 539 608 797 909 1,316
‐
2,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20142000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
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CREDIT TO PRIVATE SECTOR (US$ MILLION)
9,345
9,000 10,000
5,846
7,352
6,000 7,000 8,000,
2 388 2 5113,241
4,326
3 000 4,000 5,000 6,000
228 238 269 336 451 582 893 1,595
2,388 2,511
1,000 2,000 3,000
‐2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Non‐performing loans declined to 2.2% in 2014 from 2.7% in 2013
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STOCK EXCHANGE IN CAMBODIA
Offi i ll l h d J l 11 2011Officially launched on July 11, 2011
First trading on April 18, 2012
Joint venture between Cambodian and Korean exchangesJoint venture between Cambodian and Korean exchanges
7 Underwriters registered
2 Dealers2 Dealers
4 Brokers
2 Investment advisories
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ABUNDANT RESOURCES, LABOR, LAND
• Oil and gas
• Minerals (bauxite, carbonate rocks, natural gas, gold, iron, ( , , g , g , ,manganese, petroleum, phosphate, rock, salt, silica…)
• Great lake (Tonle Sap)
• Beaches (more than 400km)
• Monuments / Heritage Sites
Ab d t l d• Abundant land
• Low labor cost & dynamic, young workforce
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POPULATION
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INVESTMENT TRENDS
10 888
12,000
US$ Millions
10,888
10,000
5,859
7,012
6,000
8,000
4,440
2,656 2,690 2,277
4,483
3,128 4,000
1,052 1,610
‐
2,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 June 2015
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APPROVED INVESTMENT BY COUNTRY 1994 – June 20151994 June 2015
US$ Million
10,301 10,000
12,000
4,471 3,772
6,000
8,000
10,000
,2,650
1,568 1,311 1,116 937 1,073 825 400 ‐
2,000
4,000
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APPROVED INVESTMENT BY SECTOR 1994 – June 20151994 June 2015
Approved Investment by Sector
Agriculture10%
Tourism40%
IndustriesIndustries29%
Service21%21%
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INVESTMENT OPPORTUNITIES
• Agriculture and agro–industry
• Labor intensive industries
• Processing industry
• Tourism sector
• Transportation and logistic
• ICT
• Energy
• Oil, gas and mining
• Human resource development & education
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REASONS TO INVEST IN CAMBODIA
• Macroeconomic stability
• Pro-business governmentg
• Competitive investment incentives
• One-stop service investment promotion agency
• Preferential access to regional & world markets
• Investment protection
• Efficient infrastructure and strategic location
• Sound financial sector
• Abundant resources, labor, land
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COUNCIL FOR THE DEVELOPMENT OF CAMBODIATHE DEVELOPMENT OF CAMBODIA
www.cambodiainvestment.gov.kh
H E Keat Chhon sambathken@yahoo comH.E Keat Chhon [email protected]
H.E Chanthol Sun [email protected]
H.E Sok Chenda [email protected]
H.E Chea Vuthy [email protected]
H.E Heng Soknang [email protected]
Cambodian Investment Board: [email protected]
