Tokyo, May 29 — During the Cambodia-Japan Business Forum held in Tokyo, Cambodian Prime Minister Hun Manet invited Japanese companies to explore investment opportunities in Cambodia, emphasizing the Kingdom’s growing appeal as a regional manufacturing and export base.
In his address, PM Hun Manet identified five core advantages that position Cambodia as an attractive destination for foreign direct investment (FDI), particularly for businesses looking to serve both domestic and international markets.
Five Key Investment Advantages in Cambodia
1. Political Stability and Consistent Economic Growth
Cambodia offers a politically stable environment underpinned by sustained macroeconomic growth. Before the COVID-19 pandemic, the country maintained an average annual GDP growth rate of around 7%. Current projections forecast medium-term growth between 5% and 6%, supported by ongoing government reform policies and a long-term vision for sustainable, green development.
The Prime Minister highlighted that this growth is strengthened by regular government-private sector dialogue and a policy approach rooted in collaboration.
2. Government-Private Sector Collaboration
Cambodia maintains direct and structured engagement with the business community. A key mechanism is the Government-Private Sector Forum, which is held regularly to address investor challenges and support transparency. At the 19th forum held on November 13, 2023, the government announced reform measures across ten key sectors, benefiting both Cambodian and Japanese investors.
In response to stakeholder feedback, the General Department of Taxation also released a standard operating procedures guidebook to improve clarity and transparency in tax audits. Cambodia conducts biannual consultations with Japanese private sector representatives to address specific concerns, reinforcing the government’s commitment to investor support and long-term partnership.
“Investors are regarded as vital partners, with a shared vision of ‘thinking together, working together, sharing responsibility, and growing together’,” said Prime Minister Hun Manet.
3. Investor-Friendly Policies and SEZ Development
Cambodia’s updated Law on Investment offers generous tax incentives, including up to five years of tax exemption for priority sectors. The government continues to streamline administrative procedures and is investing heavily in the development and efficient management of Special Economic Zones (SEZs).
Plans are underway to introduce industry-specific and country-focused SEZs to attract targeted investment—including the possibility of Japan-dedicated SEZs.
4. Preferential Access to Regional and Global Markets
As a member of ASEAN and a signatory to the Regional Comprehensive Economic Partnership (RCEP), Cambodia benefits from access to vast international markets. The country has also signed bilateral Free Trade Agreements (FTAs) with China, South Korea, and the United Arab Emirates.
In addition, Cambodia’s WTO membership enables it to trade under preferential terms through mechanisms such as the Most-Favored Nation (MFN), the Generalised System of Preferences (GSP), and the Everything But Arms (EBA) initiative. These agreements enhance Cambodia’s export potential far beyond its 17 million-strong domestic market.
5. A Young, Skilled, and Evolving Workforce
Cambodia’s workforce is one of the youngest in Asia and is increasingly gaining skills aligned with modern industrial demands. The government is actively investing in digital transformation, green economy initiatives, and major infrastructure projects, such as:
- New expressways connecting key provinces
- Expansion of deep-sea ports to facilitate exports
- The Techo Canal project, linking inland transport routes to maritime trade
- A new international airport to support growing connectivity
A Call for Deeper Cambodia–Japan Investment Cooperation
Prime Minister Hun Manet’s presentation at the forum underscores Cambodia’s commitment to building long-term economic partnerships. Japan remains a major investor in Cambodia and a key development partner, especially in infrastructure, healthcare, and technology.
By emphasizing economic openness, legal clarity, and logistical readiness, Cambodia is positioning itself not only as a rising Southeast Asian economy but also as a strategic platform for manufacturing, innovation, and export-driven investment.
