Why Cambodia?
Cambodia is a developing market economy that has grown at an
average rate of over 10 percent
since 2004; however growth is
projected to slow in 2009 due to the global economic
crisis. Roughly one-third of 13.3 million Cambodians live
in poverty, however the government hopes to raise the living
standard of citizens through one of the most liberal investment
regimes in Asia.
A democratic system and constitutional monarchy were re-established in 1993 after more than two decades of civil war and communist rule, including the period 1975 – 1979 when the Mao-inspired Khmer Rouge killed most of Cambodia’s intellectuals and capitalists. Following peace accords between Cambodia’s warring parties, the country held national parliamentary elections in 1993, 1998, 2003, and 2008. Coalition governments between the formerly antagonistic Cambodian People’s Party (CPP) and royalist FUNCINPEC party emerged from the 1993, 1998, 2003 elections. In the July 2008 election, the CPP won an outright majority, but accepted FUNCINPEC as a minority coalition partner. In September 2008, a government with the CPP’s Hun Sen as Prime Minister was sworn in; all ministers and all National Assembly committee chairpersons were from the CPP. The most recent 2008 coalition government pledged to devote its full energies to accelerate economic development through the implementation of an ambitious economic and political reform program.
Cambodia is one of the few Least Developed Countries (LDCs) to export over $2 billion. Since Cambodia became the first LDC to join the World Trade Organization (WTO) in 2004, trade has steadily increased, and the U.S. has been Cambodia’s largest trading partner. In 2008, exports to the U.S. were $2.4 billion, at least 60 percent of Cambodia’s total exports, primarily consisting of garments and footwear. U.S. exports to Cambodia in 2008 were $154 million, up 11 percent from 2007. In July 2006, the United States signed a Trade and Investment Framework Agreement (TIFA) with Cambodia to promote greater trade and investment in both countries and provide a forum to address bilateral trade and investment issues.
Trade Agreements
Cambodia joined the International Organization for Standardization (ISO) in 1995 and is also a member of the ASEAN Consultative Committee on Standards and Quality (ACCSQ). Cambodia ratified the ASEAN Framework Agreement on Mutual Recognition Arrangements. It has also signed numerous trade agreements, including the U.S.-Cambodia Trade and Investment Framework Agreement (TIFA) in 2006, which facilitates and promotes greater trade and investment of the two countries and provides a forum to address bilateral trade and investment issues. Two successful meetings were held under the TIFA in 2007 in which the U.S. and Cambodian governments discussed WTO accession requirements, trade facilitation and economic development initiatives, and progress on intellectual property rights. In 2008, several bilateral working level meetings were held to advance the TIFA agenda. Additional information on trade agreements can be found at:
- Bilateral Trade Department of Ministry of Commerce
website: http://www.moc.gov.kh/
- Cambodian Investment Board of the Council for the Development
of Cambodia
Market Opportunity
Best Prospects
• Tourism Infrastructure and Resorts
• Education
• Architecture, Construction, and Engineering Services
• Household Goods and Appliances
• Agribusiness and Food Processing
• Used Cars and Automotive Parts
• Power Generation Equipment
• Fast Food and Beverage Franchises
• Pharmaceuticals, Medical Supplies, and Medical Equipment
• Banking
Government Regulations Regarding Foreigners Doing Business in Cambodia
Cambodia officially welcomes foreign direct investment.
Cambodia’s 1994 Law on Investment established an open and liberal
foreign investment regime. All sectors of the economy are open to
foreign investment and 100 percent foreign ownership is permitted
in most sectors. Article 44 of the Constitution provides that
only Cambodian citizens and legal entities have the right to own
land. Aside from this, there is little or no discrimination
against foreign investors either at the time of initial
investment or after investment. However, some foreign businesses
have reported that they are at a disadvantage vis-à-vis those
Cambodian or other foreign rivals who engage in acts of
corruption or tax evasion or take advantage of Cambodia’s poor
enforcement of legal regulations.
In addition, there are a few sectors open to foreign investors
which are subject to conditions, local equity participation, or
prior authorization from relevant authorities. These sectors
include manufacture of cigarettes, movie production, rice
milling, exploitation of gemstones, publishing and printing,
radio and television, manufacturing wood and stone carvings, and
silk weaving. The government has issued a sub-decree restricting
foreign ownership of hospitals and clinics and forbidding the
employment of non-Cambodian doctors in any specialty in which the
Ministry of Health considers there to be an adequate number of
Cambodian practitioners.
Under a sub-decree dated September 2005, Cambodia prohibits
certain investment activities, including investment in production
or processing of psychotropic and narcotic substances, poisonous
chemicals, agricultural pesticides and insecticides, and other
goods that use chemical substances prohibited by international
regulations or the World Health Organization that affect public
health and the environment. Production of electric power by using
waste imported from foreign countries is prohibited, as is
forestry exploitation.
The privatization of state enterprises and transactions involving state property has not always been carried out in a transparent manner. In several instances, the public learned that enterprises were for sale or swap only after the government announced a sale or deal to a particular buyer.
Investor rights (investment guarantees) provided for in the Law on Investment include:
Foreign investors shall not be treated in a discriminatory manner
by reason of being a foreign entity, except in respect to land
ownership as provided for in the Constitution of the Kingdom of
Cambodia;
The Royal Government of Cambodia shall not undertake a
nationalization policy that adversely affects the private
property of investors;
The Royal Government of Cambodia shall not fix the price of
products or fees for services; and
The Royal Government of Cambodia, in accordance with relevant
laws and regulations, shall permit investors to purchase foreign
currencies through the banking system and to remit abroad those
currencies as payments for imports, repayments on loans, payments
of royalties and management fees, profit remittances and
repatriation of capital.
Cambodia at a Glance
- Location: Mainland Southeast Asia between Thailand to the west and north and Vietnam to the east and southeast. It shares a land border with Laos in the northeast
- Land Boundaries: Thailand, and Laos
- Area Total: 181,040 sq. km. (69,900 sq. mi.); about the size of Missouri.
- Climate: Tropical monsoon with rainy season June-Oct. and dry season Nov.-May
- Population: 13.4 million (2008 census)
- Languages: Khmer (official) spoken by more than 95% of the population; some French still spoken in urban areas; English increasingly popular as a second language
- GDP Real Growth Rate: 10.2 percent (2007)
- GDP – per capita (PPP): $606 (2007)
- GDP by Sector: Agriculture: 29 percent; industry: 27 percent; services: 39 percent (2007 est.)
- Government type: Multiparty democracy under a constitutional monarchy
Country Commercial Guide
If you are interested in Cambodia Country Commercial Guide, please click here to download.
Upcoming Events
For events information, visit www.export.gov/tradeevent.html .
Contact Us
United States Embassy Phnom Penh
Cambodian Mailing Address: #1, St. 96, Phnom Penh, Cambodia
U.S. Mailing Address: Box P, APO AP 96546
Contact: Ms. Melissa A. Sweeney, Economic/Commercial
Officer
Contact: Mr. Chheng Kimlong, Economic/Commercial Specialist
Tel: (855-23)728-116
Fax: (855-23)728-800
E-mail: SweeneyMA@state.gov
E-mail: ChhengK@state.gov
Website: http://cambodia.usembassy.gov
Website: http://phnompenh.usembassy.gov/economic_affairs_office.html
United States Commercial Service
U.S. Embassy Bangkok
GPF WitthayuTower A, Suite 302,
93/1 Wireless Rd., Bangkok 10330, Thailand
Contact: Cynthia Griffin-Greene, Commercial Counselor
Tel: [66](2) 205-5090
Fax: [66](2) 255-2915
E-Mail: cynthia.griffin.greene@mail.doc.gov
Website: www.buyusa.gov/thailand/en/
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