The rising underdog: Cambodia
Post date: Aug 10, 2015 6:21:36 AM
The spotlight is southbound as foreign investors slowly shift their attentions to developing Southeast Asian countries, such as Cambodia. The many challenges and sociopolitical issues that the country used to face has begun to dwindle as the growth rate continues on a steady rise and foreign entities begin to sprout on local soil. “During the past 10 years, Cambodia’s economy has had an average real growth rate of 7.9 per cent and is expected to grow by an average of 6.7 – 7.4 per cent over the next three years as regional trade and investment expands after the ASEAN Economic Community (AEC) is formed at the end of 2015,” said Bangkok Bank President Chartsiri Sophonpanich, in response to a new branch that just opened in Phnom Penh.
“Cambodia also has other attractive features, such as special trading privileges, an abundance of natural resources that are vital to the economy, and low wages. Moreover, the government has a policy of encouraging foreign investment, with no limits on shareholding or capital controls, no restrictions on fund transfers out of the country, reduced income taxes, import and export tax exemptions, supporting international investment in transportation development, as well as revising laws and regulations to keep them up-to-date. These factors will attract more businesses to invest in Cambodia and present ideal opportunities for Bangkok Bank to facilitate and meet the needs of customers doing business in the country,” Chartsiri said.
Low global oil prices will also prove beneficial to developing countries, such as Cambodia. “Lower oil prices will boost domestic demand in most countries in the region and provide policy makers a unique opportunity to push fiscal reforms that will raise revenues and reorient public spending toward infrastructure and other productive uses. These reforms can improve East Asia’s competitiveness and help the region retain its status as the world’s economic growth engine,” said Axel van Trotsenburg, World Bank East Asia and Pacific Regional Vice President.
As the tide changes, young entrepreneurs are also fanning the startup culture with the perks of affordable living and the gradual rise in the tech community. Many of these startups are socially driven and are targeted to make a difference due to a plethora of non-profit organizations that have been set up in the past decades. These investments that spark international attention has also contributed to a significant decrease in the commercial sex trade in Cambodia. The kind of progress that the country is experiencing really sets an example for developing nations around the world.
An improving economy and a safer environment foretells the rise in education, where local scholarship programs are being created to help children from families below the poverty line to remain in school. Michelle Obama’s new program to promote education for girls in developing countries also included a trip to Cambodia recently.