Despite sound investment incentives and healthy economic growth in Cambodia this year, Thai investors claim the neighbouring country’s unstable political situation and broken bureaucracy make it too risky to invest in. ”It will take some time for Thai companies to lay investments in economic zones in Cambodia. Politics is a main condition,” said Phairush Burapachaisri, deputy secretary-general of the Thai Chamber of Commerce.
Cambodian Prime Minister Hun Sen has served as the country’s leader in some fashion for the past 21 years. The Cambodian economy grew 8.5% last year, and will likely grow 6% this year, according to the Asian Development Bank.
Mr Phairush, together with more than 100 leading Thai businessmen, attended a Cambodian roadshow designed to promote investments in nine economic zones, including Poipet, Koh Kong, Kampot, Stoeng Hav and Sihanoukville.
About 40 private sector representatives led by Cambodian Commerce Minister Cham Prasidh approached Thai companies to set up labour-intensive investments to produce garment, household products and agricultural goods in order to enjoy trade preferences Cambodia receives when it exports these items to 28 developed countries.
Under the Generalised System of Preferences (GSP) system, selected Cambodian goods enjoy low import duties when sold to developed nations, Mr Cham Prasidh said. The minister added that investments would be win-win as Thai businesses could enjoy the tax advantages, while Cambodia would have more jobs, reducing the number of illegal workers who enter Thailand in search of work.
Cambodia has 2,073 garment factories, and the value of foreign direct investment is expected to reach US$3.036 billion this year, Mr Cham Prasidh said.
Thai Commerce Minister Krirk-krai Jirapaet urged Thai businessmen to consider Cambodia as new investment opportunity, as it recently joined the World Trade Organisation.
Source: Bangkok Post