Cambodia prepares new law to attract more foreign investment

The Secretary of State of the Cambodian Ministry of Economy and Finance, Phan Phalla, announced during a press conference in mid-July to discuss the government's response to the impact of the pandemic that his government plans to implement a new investment law as soon as possible. 

As reported by the local Khmer Timez, Phan Phalla noted that the draft law is 95% complete and could come into force by the end of this year, coinciding with Cambodia's free trade agreement negotiations with priority partners such as China, South Korea, India and the Eurasian Economic Union.

He also stressed that the authorities have been working on its drafting for several years, by gathering input from the private sector and other international partners, to develop a new regulatory framework that will make the country more attractive to international investors and serve to significantly improve the business environment.

"The new investment law will improve the investment environment, maintain the existing ones and attract new ones," said the leader, who also noted that they have given this initiative an urgent character "to respond adequately to the current trend of relocation of investments," such as those from China.

It is also expected to provide incentives for the establishment of new industries beyond clothing and tourism, and thus to improve the country's economic diversification and competitiveness, and to remove trade barriers.

Cambodia's first investment law dates back to 1993 and was revised in 2003 to improve processes and enhance the business environment. The Government hopes that the new regulations will be a further driving force in the overall strategy to turn the country into an upper-middle-income economy by 2030 and achieve "high-income" status by 2050.