Sep
11
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Cambodia opening its doors to investment
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With GDP growth averaging around 9% for the past decade, Cambodia is certainly attracting interest from potential investors. It has possibly the most investor-friendly environment in Asean with no exchange controls, no restrictions on repatriation of profit, and no discrimination between foreign and local investors.
Moreover, corporate income tax is 20% and there are tax holidays of up to nine years. Foreigners can also take out leases on land for up to 99 years and foreign companies can buy land.
For Thai investors, the interest so far has been in Cambodia’s growing footwear and garment industry. This is Cambodia’s biggest employer and key export earner and there are over 300 garment or textile factories. Low wages – about one-third the level of Thailand’s – are a big attraction for investors, even though the minimum wage for garment workers in Cambodia rose from $61 a month to $66 earlier this year. Cambodian garments and footwear also enjoy favourable tariff-free access to markets in the United States and Europe.
Many American and European brands are already outsourcing their production to Cambodia. One of the benefits for these companies is the unionised workforce and labour laws in Cambodia, as it is assumed that basic rights of workers are protected. This provides insurance for big-name brand companies concerned about possible consumer boycotts over poorly treated workers.
There are challenges, however, for investors in Cambodia’s textile and garment industry. For example, there are already signs of labour shortages – earlier this year the Cambodian industry association said that many vacancies had gone unfilled as more young people were being lured to work overseas.
Another potential problem is strong competition from Myanmar as economic sanctions fade and investors from developed economies begin establishing businesses there.
A third problem facing all manufacturers is the electricity supply – electricity in Cambodia is expensive and access is largely restricted to urban centres, with only 20% of households nationwide connected to the power grid.
However, these issues do not seem to be a major concern to Japanese investors who last year more than doubled their investment in Cambodia to around $75 million. According to the Japan Times, Japanese investors are focusing on Cambodia as labour costs are rising in Thailand, China and Vietnam. Although Japanese investors are interested in the garment and textile industry, they are also concentrating on food processing, agriculture and tourism, retail, transport services and natural resources development.
The Japanese government has also worked with the Cambodian government to develop the Sihanoukville Special Economic Zone near Thailand’s eastern border. This industrial zone adjoins the Sihanoukville Port, which is the only deep-water port in Cambodia, and the infrastructure is being developed by Japanese engineers and contractors.
Sihanoukville Port is being prepared for listing on the Cambodian Stock Exchange later this year and is expected to attract great interest, given the success of the Exchange’s first listing, in April this year, when the IPO of the Phnom Penh Water Supply Authority was many times oversubscribed.
As one of the frontier economies of Southeast Asia, and a close neighbour, Cambodia should certainly be of interest to Thai SMEs considering expanding their production base. Although Cambodia has been mainly limited up until now to small scale enterprises dominated by tourism and the garment and textile industry, the new developments taking place are a sign of things to come.
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Sep
11
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Cambodia’s arrivals improve in July
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Tourist statistics in July showed arrivals from Laos to Cambodia almost doubled, while arrivals from Thailand continued to grow at a slower rate.
Cambodia’s Statistics and Tourist Information Department, Ministry of Tourism, reported arrivals from Laos grew 94.9% supplying 24,064 visitors to Cambodia during July. The growth rate has skyrocketed over 70% since January this year.
As for arrivals from Thailand, the numbers increased significantly by 75.8% to 13,538. However, the growth was slower than June when it doubled over 2011.
Over the seven-month period, January to July, arrivals from Thailand and Laos improved 88.8% and 88.5% respectively. They ranked fifth and fourth suppliers to Cambodia’s tourism industry.
Overall, Cambodia recorded 284,282 international visitors in July, improving 18.7% year-on-year. The slower growth in July (increasing over 20% for the first six months) pulled the average growth rate down from 26.8% at the end of June to 25.6% at the end of July. Accumulated arrivals stood at 2,040,862.
Arrivals from the top three suppliers — Vietnam, Korea and China showed improvement in July though not drastically: +24.1%, +11.1% and +23% respectively.
Among the top 10, only Australia in ninth place reported a decline at 6.1% (9,233).
Arrivals from the Philippines grew 50% to 60% since the start-up of the first air link (Cebu Pacific) on the Manila-Siem Reap route 19 April. Growth slowed to 15.7% in July supplying 6,090 visitors.
By region, all markets reported growth except Africa, which represents a very small share. It declined 21.9% to 348 visitors.
Growth from Asia Pacific, accounting for a 78.5% market share, contracted from 33.8% in June to 22.2% in July (223,189). Declines were recorded for Oceanic, -6.3% due to the decrease from two main sullpiers –Australia and New Zealand.
Europe recorded a small increase, 8.5% (41,936) as arrivals from several source countries dropped including the United Kingdom ( -7.1%). Russia grew 44%, while Germany, Netherlands and Switzerland also improved, 24.8%, 25.4% and 20.6% repectively.
The Americas gained 5.3% (18,039) and the Middle East, +19.3% (679).
The surge in trips from neighbouring countries was reflected in a further rise of land arrivals.
Overland travel accounted for 55.5% during July recording 154,519 arrivals, while, 44.5% of the total travelled by air. Phnom Penh International Airport welcomed 60,057 passengers (21.1% share), while Siem Reap International Airport welcomed 66,348 (23.3% share).
Phnom Penh and other provinces welcomed 140,818 tourists, or 49.5% of the total, improving 20.8%. Siem Reap tallied 143,464 tourists with a substantial increase of 16.7% over the same period in 2011
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Sep
11
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ASEAN nations promote tourism in city
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According to organizers, Cambodia and Myanmar will introduce their heritage tourism products, while the products of Vietnam and Laos focus on sea tourism and ecotourism respectively. The four countries will bring to the expo their typical products and jointly promote to attract international tourists.
Nguyen Van Tuan, general director of the Vietnam National Administration of Tourism (VNAT), said at a press conference in HCMC on Thursday that the tourism ministers of the four countries would meet at the expo to discuss tourism cooperation.
After that, mayors of cities in the Greater Mekong Sub-region, including Phnom Penh, Vientiane, Yangon, Bangkok and HCMC, will also meet in the city and promote tourism cooperation between the four countries and the Mekong Sub-region with specific activities to create competitiveness in the area.
“Through previous travel expos, Vietnam, Laos, Cambodia and Myanmar have had several joint tourism promotion programs. But now we want to expand the scale and cooperate with countries of the Mekong Sub-region to create a greater competitiveness,” said Tuan.
The expo will take place at Saigon Exhibition and Convention Center in District 7 from Thursday until next Saturday.
According to organizers, the expo will feature 233 booths of travel firms and hotels from 19 nations and 26 local tourism promotion agencies. Around 200 customers from 33 markets will buy international tourism services and meet partners at the expo.
In addition to meetings for travel firms, the expo will include programs for tourists.
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ASEAN nations promote tourism in city
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11/09/2012 11:11:37
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Raffles Hotel Le Royal Phnom Penh
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11/09/2012 10:47:54
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Aviation helps regional growth take off
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11/09/2012 10:19:36
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Tourism sector needs skills standards
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11/09/2012 10:16:09
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HCM City hosts int’l tourism expo
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11/09/2012 09:50:45
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Russian businesses explore Ninh Thuan’s tourism potential
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11/09/2012 09:45:09
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Russian businesses explore Ninh Thuan’s tourism potential
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11/09/2012 09:33:45
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Photographic exhibition on Vietnam opens in France
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11/09/2012 09:32:13
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Vietnam Airlines cooperates with SNCF from France
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11/09/2012 09:30:37
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