Cambodia to be classified as the new Asian Tiger, outpaces its neighbours

Industry experts believe that the Kingdom will soon join the ranks of the Four Asian Tigers

Cambodia is among the fastest-growing countries in the globe, with Khmer Times reporting that its economy has grown annually at an average of 7.7 percent between 1998 and 2019, and the volume of foreign investments has increased 138 times in the past decade. 

Foreign direct investments (FDIs) have soared to USD3.49 billion in 2019 and have expanded by 115 percent to USD7.59 billion in 2020, one of the best globally. 

At such pace, the President of the American Chamber of Commerce and Group CEO of Cambodian Investment Management Holdings Anthony Galliano is confident that Cambodia will be the new “Asian Tiger of the 21st Century”. 

The Asian Tiger rank is granted to countries that have steadily showcased a high rate of economic growth since the 1960s, revealed Corporate Finance Institute. In the region, Singapore, Hong Kong, South Korea, and Taiwan have achieved the title and have been dubbed the Four Asian Tigers. 

Anthony said that the kingdom is currently on the same growth path and is far from the recovering poor, undeveloped country that the rest of the globe perceives.  

“Now it is a lower-middle-income country and expected to attain upper-middle-income status by 2030, or even earlier by 2028,” he told Khmer Times. 

More: Nowhere but up: Top trends that will shape Cambodian real estate in 2022

Below are some of the factors that bode well for the country’s future: 

• Foreign investors can own 100 percent of a company, except for some industries  
• A highly dollarised economy deters capital flight and ensures less risk in exchange rates 
• Low corporate tax 
• USD1,000 minimum capital requirement to establish a company 
• Regional Comprehensive Economic Partnership and membership in free trade agreements 
• Young population of roughly eight million under 25 years 

Edward Lee, the CEO of 2021 PropertyGuru Cambodia Property Award-winner Prince Real Estate, said that investors are favouring Cambodia over Malaysia, Myanmar, and Vietnam due to their respective situations. 

“Cambodia is now as accessible as Dubai for foreign investors and as exciting as Thailand with a thriving entertainment industry,” reassured Edward. “[It] is also the most liberal and investment-friendly country in Southeast Asia. What we need to do is to showcase more varieties of real estate products.” 

Other major winners, namely Best Developer Urbanland, Best Lifestyle Developer Sophea Suites Co., Ltd, and Best Breakthrough Developer Mekong Land Development Co., Ltd, have geared up their marketing activities to reintroduce their portfolios to potential new investors.

More: Around the Table with the Judges: PropertyGuru Cambodia Property Awards

To further promote foreign investment and drive economic development, the Khmer Home Charity Association with exclusive endorsement from the Ministry of Interior has launched the “Cambodia My 2nd Home” programme. 

Under this new scheme, Khmer Times stated that applicants will receive several benefits to ease ‘living and business’ such as the 10-year unlimited entry and exit visas, membership under the Association, VIP treatment, local insurance coverage, and eligibility to apply for a Cambodian passport after five years. 

The introduction of this new programme and the country’s steadily growing economy will propel more FDIs, which, in turn, will lead to the recovery of the construction sector in 2023. 

Prime Minister Hun Sen forecasts the construction sector’s recovery to continue at 7.2 percent by next year. He noted that the investments in the first half of 2022 have already surpassed USD1 billion. 

As for the real estate sector, experts predict a rise in buying and selling transactions in high-end residences and a stable growth in low- and medium-priced homes, which will generate a growth rate of 5.2 percent by 2023.  

To find out who will nab the prestigious titles and represent their country at the Grand Final, visit asiapropertyawards.com/award/cambodia/ when we announce the winners on 26 August 2022. 

Gynen Kyra Toriano, Digital Content Manager at PropertyGuru, wrote this article. For more information, email: [email protected].