INVESTMENT OPPORTUNITIES

in Cambodia

presented by

CHEA VUTHY

Deputy Secretary General of the Cambodian Investment Board

the Council for the Development of Cambodia

Key Indicators

Land area : 181,035 sq.km.

Population: 14.1 Million

Labor force (young) : 7,053,398

(Female: 3,608,345)

Population growth rate : 1.54%

GDP (2011) : 6.5 %

GDP per capita in 2011 : $909

Inflation (2011) : 5.5%

Exchange rate: USD 1= 4,000 Riels

2

Robust economic growth

High economic growth during the decade before the onset of the

global financial crisis.

4.1%

9.1%

6.4%

5.9%

4.0%

4.7%

12.7%

10.7%

7.4%

6.6%

8.5%

10.3%

13.3%

10.8%

10.2%

6.7%

0.1%

5.5%

6.0%

0%

2%

4%

6%

8%

10%

12%

14%

1993 1995 1997 1999 2001 2003 2005 2007 2009e 2011p

Economic Growth Rate: 1993 - 2011

ON

E S

TO

P S

ER

VIC

E

OP

EN

DO

OR

PO

LIC

Y

4

H.E. Mr. Chhieng Yanara

Secretary General CRDB

H.E. Mr. Keat Chhon, Deputy Prime Minister

Minister of Economy and Finance

1st Vice Chairman

H.E. Mr. Sok Chenda Sophea

Secretary General CIB

Trouble

Shooting

Committee

Samdech Akka Moha Sena Padei Techo HUN SEN

Prime Minister of the Kingdom of Cambodia

Chairman

Council for the Development of Cambodia (CDC)

H.E. Mr. Chea Vuthy

Deputy Secretary General CSEZB

H.E. Mr. Kong Vibol Secretary of State of Economy & Finance

Vice Chairman

H.E. Mr. Sok Chenda Sophea

Minister attached to the Prime Minister

Secretary General CSEZB

H.E. Ms. Heng Sokun

Deputy Secretary General CRDB

H.E. Mr. Sok Chenda Sophea

Minister attached to the Prime Minister

Secretary General

H.E. Mr. Cham Prasidh,

Senior Minister, Minister of Commerce

2nd Vice Chairman H.E. Mr. Sun Chanthol

Senior Minister in charge of Special Missions

Permanent Vice Chairman

H.E. Mr. Rith Vuthy

Deputy Secretary General CRDB H.E. Mr. Chea Vuthy

H.E. Mr. An Sophanara

H.E. Mr. Heng Soknang

Deputy Secretary General CIB

SEZ ODA FDI GMS National Secretariat

5

Information & Application

Approval

Customs Duty & Tax Exemption

Visa & Work Permit

Company Registration

A ONE STOP SERVICE 6

Licensing Authorities

Council of Ministers : CDC but needs approval from CoM for project with investment capital exceeding $ 50 million, BOT, BOOT, BOO or BLT, long-term strategy, sensitive projects: negative impact on the environment and natural resource exploitation

CDC : less than $ 50 million

Provincial Authorities : less than $ 2 million

7

Investment Approval

Investment application

CDC issues a Conditional Registration Certificate to the Applicant

Company Registration / Ministry of Commerce

Relevant licenses, as appropriate / Ministry of Industry and Energy

Review and approval of construction plan / local authorities-

Ministry of Land Management, Urban Planning and Construction.

Initial environmental impact assessment / Ministry of Environment

Tax Department Registration / Ministry of Economy and Finance

CDC issues a Final Registration Certificate to the Applicant

3 working days

28 working

days

8

Investment Incentives

20% Corporate Tax

Tax holidays: Trigger period +3years+n; 6y <TH<9y

Full Import Duty Exemption

Repatriation of profit (withholding tax)

Reinvestment of earning (special depreciation)

9

Investment Protection

Equal treatment of all investors

No requirement of local equity participation

No price controls on products or services

No restriction on forex convertibility

Free remittance of foreign currencies abroad

The Investment Law and Sub-decree contains a number of

important guarantees for the investors:

10

Bilateral agreement on the promotion and protection of investments between

the Kingdom of Cambodia and other countries

1. Australia

2. Austria

3. China

4. Croatia

5. Cuba

6. Czech

7. France

8. Germany

9. Indonesia

10. Japan

11. Kuwait

12. Lao PDR

13. Malaysia

14. Netherlands

15. N. Korea

16. OPEC

17. Pakistan

18. Philippine

19. ROK

20. Singapore

21. Switzerland

22. Thailand

23. USA (OPIC)

24. Vietnam

11

Encouraged Investment Activities

Agriculture and agro-industry

Transport and telecommunications

Energy and electricity

Labor-intensive industries, processing and

manufacturing;

Tourism

Human resource development

Oil & Gas, Mining

12

Approved Investments by Country/Region (1994- 2011)

US$ Million

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

Chin

a

Hong K

ong

Taiw

an

EU

Mala

ysia

US

A

Kore

a

Sin

gapore

Thaila

nd

Japan

Vie

tnam

8,849

641 839

3,641

2,614

1,282

4,040

649 746154

1,200

13

Approved Investments by Sector

1994 – 2011

Industry

24%

Agriculture

7%

Service

19%

Tourism

49%

14

Infrastructure: A definite prospect

Priority for infrastructure

Infrastructure rehabilitation

Multilateral aid availability

Decentralization

Regional opportunities

ASEAN & GMS integration

Private Participation in Infrastructure (PPI): BOT, BOO, etc…

15

Agro-business

Basic agrarian economy

Natural endowments:

Abundant land

Rich fishery resources

Organic crops

Value-added emphasis/

Food processing

New product development 16

Tourism

World Heritage Monuments

Open Sky Policy to Siem Reap

Natural beauty - Beach - Islands

Ability to attract “add-on” trips

Novelty value

17

Eco-Tourism

Tourism Center

Poipet

Sihanoukville

Gulf of Thailand

314km

230 km

150 km

Beach & Island Resorts

Bokor (hill resort)

18

Visitors to Cambodia

0

500

1,000

1,500

2,000

2,500

3,000

177 220 260 219 289368

466

604

786 701

1055

1421

1700

2015

2161

2500

2882

Thousand (000)

Visitor arrival from 2010 - 2020

YEAR 2010 2011 2015 2020

Visitor Arrivals 2,508,289 2,882,000 3,700,000 6,000,000 19

Top ten Markets

Vietnam

Korea

China

Japan

USA

France

UK

Thailand

Australia

Taiwan

20

Investment Opportunities

Phnom Penh

o International Convention Center

o High-end hotel (Four Seasons, Hyatt, etc…) at the moment there are only

Intercontinental Hotel and Raffles with approximately 500 rooms.

Siemreap

o International Convention Center

o High-end hotel (Four Seasons, Hyatt, Sheraton, and Marriott, etc…) at the moment

there are only Raffles, Le Meridien, Sofitel, Aman resorts and Orient Express, with

approximately 700 rooms.

o Amusement park / recreational activities

o Golf course (there are three existing golf courses)

Sihanoukville

o High-end hotel (Four Seasons, Hyatt, etc…)

o Golf Course

21

Manufacturing & Export

Competitive labor cost

Tax incentives

Market access

Regional arrangement 22

MFN/GSP Market Access

Australia

Austria

Belarus

Belgium

Bulgaria

Canada

China

Czech Republic

Denmark Finland

Poland

Portugal

ROK

Russian Federation

Slovakia

Spain

Sweden

Switzerland

UK

USA

EBA (everything but arms initiative for LDCs)

France

Germany

Hungary

Ireland

Italy

N-Korea

Luxemburg

Japan

Netherlands

New Zealand

Norway

… and the ASEAN integration System

of Preferences (AISP) from the ASEAN 6 23

Cambodia’s Special Economic Zones

No Activities

Under Construction

Operational Kampot SEZ Sihanoukville Port

SEZ

Poipet O’Neang SEZ

Sihanoukville SEZ1

Sihanoukville SEZ2

Stung Hao SEZ

S.N.C SEZ

Kompong Som SEZ

Koh Kong SEZ

Souy Chheng SEZ

Oknha Mong

SEZ

Kiri Sakor Koh Kong

SEZ

P (SEZ) I C

Thary Kompong Cham

SEZ

GoldFame Pak

Shun SEZ

Duong Chhiv SEZ

Phnom Penh

SEZ

24

One Stop Service

Special Economic Zone Administration

Company registration and investment license

Export/import permit

Work permit and Labor books (both workers and

expatriate)

SEZA will provide on site immediate legal and

administrative assistance

25

JOINING

WTO

JOINING

ASEAN

ACCESS TO

THE U.S.

MARKET

ACCESS TO THE

EUROPEAN

MARKET

Cambodia has embraced the globalization process as part of its

outward looking economic development strategy….

26

Reasons to invest in Cambodia

Open economy

Sound Macroeconomic Environment

Competitive Investment Incentives

One Stop Service – Fast-Track Investment Approval Process (28 days)

Low Labor Cost

Strategic Location

Preferential Trading Status

Access to ASEAN and World Markets

27

.

Phnom Penh The Philippines

Singapore

Indonesia

Myanmar Southern China

Manila Bangkok

Kunming

Yangon

Brunei

Jakarta

Begawan

Hanoi

Laos o Vientiane

CAMBODIA

Malaysia

Kuala Lumpur

Thailand

Vietnam

1h:30 in average

28

Invest in Cambodia and you

have 14 million consumers

Invest in Cambodia and you

have 325 million consumers

virtually at your doorstep

Invest in Cambodia and

you have 590 million

consumers at your

doorstep 29

Thank you 30

www.cambodiainvestment.gov.kh

CDC k>G>k CDC CDC k>G>k

k>G>k

k>G>k k>G>k k>G>k CDC CDC

CDC

CDC

CDC

CDC

CDC

k>G>k

k>G>k

k>G>k

k>G>k

k>G>k k>G>k CDC k>G>k k>G>k

k>G>k

k>G>k

k>G>k

k>G>k

k>G>k

k>G>k k>G>k k>G>k

CDC

CDC

CDC CDC CDC CDC

CDC

CDC

CDC

CDC

CDC

CDC

k>G>k

k>G>k k>G>k k>G>k

k>G>k

CDC

CDC

CDC

CDC

31