Signs point to more diverse investment projects in Cambodia
The effects of the global financial crisis in 2008 and 2009 on the Cambodian economy showed how perilous having a narrow economic base can be. Since the Kingdom’s economy is dependent on a few “pillars”-garments, construction, tourism and agriculture-downturns in any of those sectors can have serious consequences. While GDP from 2003 to 2007 grew at above nine percent a year, during the global crisis in 2008 growth slowed to 6.7 percent and then almost stopped in 2009, the economy expanded just 0.1 percent. The rapid downshift demonstrated more acutely than ever the need to broaden the economic foundation. Now economic diversification is at the heart of the government’s sustainable growth plan. … But economists say further diversification is necessary and for that, the country needs the investment to keep coming. The government’s strategy to achieve this is to expand its network of special economic zones (SEZs), geographic areas with business-friendly regulations. … The Council for Development of Cambodia has approved 21 SEZs across the country. However, just eight of these are fully operational. The Phnom Penh Special Economic Zone (PPSEZ) is the most active-it has 47 companies on its campus, including 24 Japanese firms. …
