The JCI ASPAC Angkor 2024 'Business Dialogue and Matching' session was held on June 8, 2024 in Siem Reap and featured three expert panellists from the agriculture, real estate, and tourism sectors, who provided insights into the latest developments in policy as well as highlighted the business opportunities for investors seeking to enter the Cambodian market.
The panellists were; H.E. Sok Soken, Minister of Tourism, H.E. Khim Finan, the Under-secretary of State and Spokesperson at the Ministry of Agriculture, Forestry and Fisheries (MAFF), and Neak Oknha Sear Rithy, Chairman of World Bridge Group, a Cambodian conglomerate.
Cambodia's Tourism Development Prospect
H.E. Sok Soken, Minister of Tourism, outlined Cambodia's strategy to revamp the tourism industry post-pandemic during, focusing on 8 priorities called "BUILD Plus 3Ds" which was launched in September 2023. This policy aims to improve branding, marketing, infrastructure, product diversification, and industry competitiveness through digital transformation for the Cambodian tourism sector.
Soken also emphasised the role of the upcoming Cambodia Tourism Marketing and Promotion Board (CTB), which is designed to engage with the private sector, foreign investors, and local actors.
"This really discusses how we remain competitive as an industry, as a sector and sub-sector of tourism,, and perhaps, if we start to have saturation, the consolidation aspect is not a happy story for everyone. I think it's something that we want to have a process driven approach for. But there are obviously opportunities to invest at different scales, right?" the Minister asked.
He added that from major infrastructure projects down to food and beverage (F&B), hospitality, wellness and spas, he wants to make sure that the Angkor Archeological Site (famous for Angkor Wat and still Cambodia’s biggest tourist attraction) will be a place people can enjoy during the day and the night.
So how do we make sure that there's a digitisation aspect, there's a whole experience approach? I want to push for design thinking into tourism and really look at how we can improve the overall human experience when it comes to travelling.
Soken also discussed opportunities to invest in improving transportation infrastructure, developing new tourism products, and promoting quality services in Siem Reap, which is a focus area for cultural and heritage tourism in the Kingdom.
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Beyond Boreys & Condominiums: What Are Other Opportunities In Cambodian Real Estate?
On the topic of Cambodian real estate (which is still a key pillar of the economy), Neak Oknha Sear Rithy emphasised that the property industry encompasses more than just building condominiums and hotels. He noted that tourism, agriculture, and logistics properties are also part of this sector.
He noted that the property sector is currently in a period of slow growth, affecting not only Cambodia, but also in neighbouring countries like Vietnam, Thailand, and even a bigger market such as China. He asked how we can overcome this situation and answered that investors need to understand the market.
Rithy advised property investors to focus on logistics infrastructure, tourism, agriculture, and infrastructure properties in Cambodia. The WorldBridge Group chairman believes the Cambodian property market remains undervalued compared to neighbouring countries.
Cambodia is just an emerging market. There is a big opportunity here, because our property market is not that high yet. If we compare it to Vietnam, where the cost per square metre of land in the Central Business District (CBD) is about USD $10,000 or $12,000. In Cambodia, the maximum might be about USD $5,000.
"The industrial property price is less than USD $100 per sqm in Cambodia, while in other countries it's about USD $200 to $300. So with these figures you can figure it out for yourself. But regarding which property market you should look into here, you should study it more," added Rithy.
I can assure you that if you build warehouses for logistics now, you have a lot of demand. That is one of the keys that you should understand from a foreign investment point of view.
Rithy also highlighted that the property industry needs to understand their target markets and not just follow trends. Individual developers should specialise based on their strengths, such as high-rise condominiums for his company.
“You have to look into [the market] yourself. For me, I never have developed a Borey [project], Why? Because I'm not strong in borey developments, but I'm strong in building condominiums and high rises. You have to look into the market very well and decide which one you want to do,” he emphasised.
A New Era Of Cambodian Agriculture?
In the agriculture sector, H.E. Khim Finan highlighted that agriculture makes up over 20 per cent of Cambodia's GDP and employs 35 per cent of the labour force. COVID-19 has also shown that agriculture is the most resilient sector in Cambodia, he said.
In terms of crops, Finan added Cambodian agriculture has a surplus of almost everything except vegetables.
"We grow three, we eat one," he said.
With cashew nuts, we export over 95 per cent of whatever we produce. With cassava it is the same story. Mango, the same story. When it comes to rice, we have had a surplus for over 30 years now. We have moved from a rather self-sufficient economy and now we're talking about our economic contribution from the agricultural sector to the economy.
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In the first 5 months of 2024, agricultural exports grew 64 per cent year-on-year to over USD $2 billion, driven mainly by non-rice crops like cashew nuts, mangoes, and cassava.
Finan also highlighted three priorities the ministry is focusing on in this new government's mandate:
- Launching an extension service program to support farmers.
- Establishing a standby fund to stabilise prices of strategic crops.
- Promoting modern agriculture cooperatives for production and economies of scale.
The Cambodian government has delivered extension services to workers in every commune throughout the country. In 2023, the government recruited 250 extension workers, and another 800 in 2024, with the goal of having a standby commune officer in every commune over the next year.
Of the second policy, creating a standby fund to stabilise strategic crop prices, Finan said, this is the first time the government has started such a project. He emphasised that this will protect the Cambodian farmers from price fluctuations.
"Why is it important? Because we've been observing that in order to protect our farmers, we have to ensure that the price of their crops will stay at a certain level. If it's too cheap, they [farmers] will lose money, but if it's too expensive, it will cause problems and headaches for the economy and we don't want that," he said.
Thirdly, Finan added that the ministry's plan is to use a cooperative model called "Modern Agriculture," which has evolved from service cooperatives, which were focused more on joint purchasing and selling, to production cooperatives that focus on joint production. The government is looking at ways to place Cambodian agriculture in a more competitive position, both in terms of price and quality, as well as the steadiness of the supply.
"Why is it important? Because until we have economies of scale from the modern agricultural cooperatives, our costs will not be lowered. And if we're not able to be competitive in terms of costs, we will not be able to compete on an international level," he concluded.
2024 JCI ASPAC Angkor 'Business Dialogue & Matching'
Sok Chantha, CEO of Poma Media Co., Ltd, one of the main sponsors of the event, shared his views with B2B Cambodia on why ASPAC 2024 is important.
"It is very important for Cambodia," he said. "It is an opportunity to attract tourists and also attract investors to visit our country, especially Angkor Wat, and to understand the potential of the Cambodian economy," he said.
As an event participant and a member of JCI Phnom Penh, Lim Bunchheang, Sales Director at Ruising Chemicals Pte Ltd, a chemical fertiliser company importer from Singapore, said he was thrilled to be part of the JCI platform in 2024.
"We can meet not only with local business owners, but also those from more than 50 countries around the world," he said. “We have really learned a lot, and have been able to meet friends from Nepal, Bangladesh, and India who are interested in my business and may bring our brand into their countries.”
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