China Emerges as Cambodia’s Top Foreign Investor

China Emerges as Cambodia’s Top Foreign Investor. It has been Cambodia’s biggest wellspring of foreign ventures for 12 successive years. The respective precious stone collaboration prompted the development of speculation. It also boosted exchange between the two nations. As per Chinese measurements, two-sided exchange between January and October this year came to $14.4 billion, an increment of 19% year-on-year.

Its imports from Cambodia grew by 20% year-on-year. This information comes from a report. Zhong Jie presented the report. He is the Financial and Exchange Counselor of the Consulate of the People’s Republic of China in Cambodia. It truly shows how China emerges as Cambodia’s top foreign investor.

Emerging investors of China

Cambodian measurements additionally show that China has been the Realm’s wellspring of unfamiliar venture for a long time, she said. Adding that, from January to October this year, Chinese undertakings consented to speculation arrangements in Cambodia worth almost $3 billion. China emerges as Cambodia’s top foreign investor.

Zhong spoke at the initial function of the Cambodia Renminbi Clearing House at Hyatt Rule Phnom Penh on Friday. He stated that China and Cambodia are unfaltering accomplices. They support one another and share a typical fate. Recently, the heads of our two countries have provided essential direction. With their guidance, the structure of the China-Cambodia People community of Shared Future has expanded steadily.

“The ‘Jewel Hexagon’ participation structure has become stronger. Significant progress has been made in improving the ‘Modern Advancement Passage.’ The ‘Fish and Rice Hall’ improvements bring clear benefits to both countries,” she said. This year marks the 66th anniversary of strategic relations between the two countries.

It is also the China-Cambodia Individuals-to-Individuals Trades Year, said Zhong. She added that China will work with Cambodia to additionally develop monetary participation. This includes enabling monetary foundations from both nations. They will provide funding and monetary services to support exchange and venture cooperation. China emerges as Cambodia’s top foreign investor due to these ongoing partnerships.

“I accept that monetary collaboration among China and Cambodia will yield more unmistakable outcomes. It will infuse new energy into the structure of an excellent, undeniable level. The exclusive requirement China-Cambodia People group of Shared Future will also be energized in the new time,” she said.

Rath Sovannorak, Delegate Legislative head of the Public Bank of Cambodia, said the kinship between China and Cambodia is well-established. The relationship is strong. It has lasted for centuries. This getting-through association has developed into a present-day organization marked by strong ties, venture, and participation across various fields.

Presently, China is Cambodia’s wellspring of unfamiliar direct speculation (FDI) and essential exchanging accomplices. By the second quarter of 2024, the all-out FDI from China represented 47%. It added up to $23 billion, with the larger part directed towards assembling, said Sovannorak. China has emerged as Cambodia’s top foreign investor.

China remains Cambodia’s top trading partner. The two-sided exchange reached $11 billion in the initial 3/4 of 2024. This reflects a 22 percent increment compared to the same period in 2023. These developments underscore the importance of Chinese investment in driving Cambodia’s financial growth. Hence, it’s in Cambodia’s greatest interest to make favorable business conditions for both current and expected Chinese investors. Especially in monetary services, it helps ensure the success and growth of their operations in Cambodia.

Why China Biggest Investor in Cambodia

Over the past two decades, Cambodia has seen rapid economic growth and increasing foreign direct investment (FDI). Among all its international partners, China has emerged as the largest investor. It contributes significantly to Cambodia’s infrastructure, real estate, energy, and manufacturing sectors. This growing economic relationship is not accidental but driven by strategic, political, and economic factors that benefit both nations.

Main Body

1. Strategic Political Alliance China and Cambodia maintain a strong political relationship. Cambodia is a key ally of China in Southeast Asia. It often supports Chinese positions in international forums. These forums include the United Nations and ASEAN. In return, China provides extensive economic support, often with fewer political conditions compared to Western donors. This close alliance fosters a stable environment for Chinese investment.
2. Belt and Road Initiative (BRI) Cambodia is a participant in China’s Belt and Road Initiative. This is a global development strategy. It is aimed at enhancing regional connectivity. Under this framework, China has invested heavily in Cambodia’s infrastructure—building roads, bridges, railways, ports, and airports. These large-scale projects create investment opportunities while enhancing China’s economic and strategic influence in the region.
3. Economic Opportunities in Cambodia Cambodia offers a low-cost labor force. It also has a strategic geographic location. Additionally, there are investment incentives like tax holidays and special economic zones. These factors attract Chinese manufacturers looking to diversify away from China due to rising labor costs. They are also influenced by international trade tensions, particularly with the United States.
4. Weak Western Presence and Fewer Conditions Western countries and institutions like the World Bank or IMF impose more demands. Unlike them, China provides loans and investment with fewer demands regarding governance, human rights, or transparency. This approach is appealing to Cambodia’s government, allowing faster implementation of projects without external interference in domestic affairs.
5. Real Estate and Tourism Chinese investors significantly influence Cambodia’s real estate and tourism sectors. They are particularly active in cities like Phnom Penh and Sihanoukville. Chinese casinos, hotels, and residential developments dominate the skyline of coastal areas, driven by tourism and gambling-related investment.

Conclusion

China’s rise as the largest investor in Cambodia results from a multifaceted strategy. This strategy combines political friendship, economic pragmatism, and infrastructure diplomacy. China has positioned itself as Cambodia’s most important economic partner through initiatives like the Belt and Road. It leverages its financial strength and geopolitical interests to achieve this position.

This relationship brings substantial development opportunities. It also raises concerns about economic dependence and national sovereignty. Cambodia will need to navigate these carefully in the future.