Long overlooked by the outside world, astonishing developments have taken place in Cambodia and the country’s economy is growing at an amazing speed. From the poverty-ridden nation with its tragic past, Cambodia has rapidly evolved into a top business location with unprecedented opportunities. This blog article will provide some key information and data, which are relevant to everyone who wants to find out more about doing business in Cambodia or has a general interest in the economy of this incredibly promising country.
The Basics: Growth, Growth, Growth
Over the past two decades, the economy of Cambodia has had a growth rate of approximately 7 – 8% – every year. But pretty much all indicators you look at, GDP or others, such as PCI, import and export figures, etc. – all you see is growth. So what is this ever-growing economy actually based on?
While almost half of the population in the very fertile land still lives from agriculture (rice, rubber, etc.), Cambodia’s economy is getting more and more diversified. Internationally Cambodia is mostly known for its huge garment industry, but while garment products still make up the largest percentage of export goods, there is much more: Fishery, wood processing, milling and mining, for example, have been long-standing important foundations of the country’s economy. More recently, as Cambodia is changing fast, more and more industries have had chances to evolve. For example, Cambodia sees a huge demand for building, construction and infrastructure related work (roads, residential and commercial buildings, transport, telecommunication, etc.).
Also Cambodia’s tourism industry has grown strongly. Previously pretty much everything was focused on must-see Angkor Wat. However, the country has meanwhile also earned a reputation for its wonderful beaches, islands, landscapes and other places of interest all over the country, and more and more Cambodians have found work in the hospitality sector.
Other services are flourishing, too. Did you know, for example, that because of its constantly improving connectivity and an ever growing number of well educated young Cambodians, the country offers much more opportunities for foreign companies to outsource jobs in areas such as data processing/evaluation, remote customer care and other electronic-based services?
Further Key Success Factors
Besides this clearly visible growth and the rapidly progressing diversification, there are many other aspects that make Cambodia’s economy highly attractive:
Cambodia has been an ASEAN member for two decades. The regional integration has proven incredibly beneficial, and links Cambodia strongly with the other member states.
Cambodia has a fantastic strategic location: The country has land borders with three other nations (Thailand, Laos and Vietnam) as well as access to the sea, particularly with the deep sea harbor in Sihanoukville. There are also plenty of international flight connections from Phnom Penh, both to other ASEAN countries and beyond.
Cambodia has already founded more than 20 special economic zones, making the country even more attractive for foreign investment. In the special economic zones, the government has created favorable business conditions, including tax benefits, high-quality infrastructure, etc.
Many young Cambodians have ambitious career plans and invest a lot of time, money and efforts in their education, meaning that international companies can easily find qualified professionals for their business plans.
There are certainly many more aspects that make Cambodia’s economy so attractive, but as this blog entry is just intended to give you a short overview, let us stop here for now and ask a question: Based on what you have just read, you will certainly have realized that Cambodia’s development and outlook are excellent and that it is a fantastic business location. But is there another side of the coin?
Cambodia – A Perfect Business Location?
You can see that Cambodia’s economy provides incredible opportunities. However, it might surprise you to learn that it is actually NOT easy to do business in Cambodia. Cambodia ranks 144 in The World Bank’s Doing Business guide, and the ranking for establishing a business is even as low as 187 (Source: Doing Business by The World Bank). This is not a good score, and there are several reasons for it. What is clear is that many foreign businesses encounter huge difficulties in Cambodia and a lot of them fail. However, there is a solution: If you have a reliable local service provider in Cambodia you will foresee challenges, overcome difficulties and solve problems.
Success– Only With Local Expertise
There are plenty of reasons why Cambodia is a fantastic business environment and why you should do business in Cambodia. But in order to succeed, you must have a trustworthy, local service provider for all your legal and business needs. LocaWize will be delighted to help you. Our expertise, experience and in-depth knowledge of Cambodia will help you plan and execute your business ideas and avoid pitfalls. We can support you with a whole range of services, including company registration, legal, accounting and tax consultancy, work permit applications and much more! If you are interested in doing business in Cambodia or have further questions about the economy of the country, our expert team will be more than happy to help. Contact us now!