China Dominates Cambodia’s Investment Landscape in 2025
China reinforced its position as Cambodia’s leading foreign investor in 2025, accounting for more than half of the Kingdom’s total approved investment capital and underscoring the depth of economic ties between the two countries. According to the Council for the Development of Cambodia, Chinese investors committed $5.42 billion, representing 54.25 percent of Cambodia’s total investment capital of $10 billion. This milestone reflects not only China’s sustained confidence in Cambodia but also a broader rebound in approved projects driven by the country’s open trade regime, competitive incentives, and improving business environment.
Strong Domestic and Regional Contributions Complement Chinese Capital
While China led the rankings, domestic investors also played a critical role in driving growth, contributing $3.12 billion or 31.27 percent of total investment capital. Singapore emerged as the third largest source with $599 million, accounting for nearly 6 percent, while the remaining share came from a diverse mix of international partners. This distribution highlights Cambodia’s ability to attract capital from both local and foreign sources, reinforcing the resilience and diversification of its investment base.
Investment Surge Signals Rising Confidence and Job Creation
The Cambodia Investment Committee registered 630 investment projects in 2025 with a combined value of $10 billion, a sharp increase from the previous year. The number of projects rose by 216, an increase of around 52 percent, while total investment capital expanded by approximately $3 billion or 45 percent year on year. These projects are expected to generate about 438,000 jobs, confirming investment as a major engine of employment and economic activity. Officials attributed the surge to improved investor confidence and sustained government reforms aimed at streamlining procedures and strengthening the overall investment climate.
Industrial Sector Leads as Tourism Gradually Recovers
Sectoral data shows that the industrial sector attracted the largest share of approved capital at $5.6 billion, reflecting Cambodia’s growing role as a manufacturing and processing hub. Infrastructure and other sectors followed with $3.8 billion, while agriculture and agro industry secured $436 million. Investment in tourism reached $175 million, signaling a cautious but steady recovery in tourism related activities after recent challenges, and pointing to renewed confidence in the sector’s long term prospects.
Provinces Emerge as New Investment Hotspots
Investment activity continued to spread beyond Phnom Penh, highlighting the success of decentralization and infrastructure development. Kampong Speu led the nation with 142 approved projects, followed closely by Svay Rieng with 139, driven largely by interest in border and industrial zones. Phnom Penh ranked third with 76 projects, while Takeo recorded 64. Koh Kong and Preah Sihanouk followed with 52 and 51 projects respectively. The CDC noted that this geographic spread reflects growing investor interest in provinces equipped with industrial parks, logistics links, and improved connectivity.
Investment Laws and Trade Agreements Strengthen Appeal
Lim Heng, Vice President of the Cambodian Chamber of Commerce, emphasized that Cambodia’s legal framework applies equally to all investors, stating that the Kingdom’s investment laws were “functioning well”. “Cambodia welcomes investment from all countries,” he said. “It is natural that Chinese investment features strongly, given the close friendship between the two nations and the sustained efforts by the Cambodian Chamber of Commerce, under the leadership of its President, Kith Meng, and the government led by Prime Minister Hun Manet to attract foreign capital.” He highlighted Cambodia’s “diamond-clad friendship” with China, supported by the Cambodia China Free Trade Agreement and the ASEAN China Free Trade Agreement, which allow companies operating in Cambodia to access ASEAN and RCEP markets more efficiently.
Broader Global Access Expands Cambodia’s Investment Reach
Beyond China, Cambodia continues to leverage a wide network of trade arrangements, including free trade agreements with South Korea and the United Arab Emirates, as well as preferential access to the European Union under the Everything But Arms scheme and Generalised System of Preferences with Canada and the United Kingdom. Heng also noted, “More recently, Cambodia secured a reciprocal tariff rate of 19 percent with the United States, which is more favourable than the standard US rate.” He added that this is expected to attract further investment not only from China but from a broader range of countries, reinforcing the Kingdom’s non discriminatory and open investment strategy.
Chinese Firms Deepen Engagement Amid Rising Trade Volumes
Lor Vichet, Vice President of the Cambodia Chinese Commerce Association, said Cambodia’s investor friendly environment and government backed incentives continue to draw strong interest from Chinese companies, particularly those operating under full foreign ownership. He explained that Cambodia’s open trade and investment policies, combined with its expanding network of free trade agreements including RCEP, have enhanced confidence and positioned the country as a strategic regional gateway. “These agreements help companies streamline market access and export their products more efficiently,” he said, reinforcing Cambodia’s growing role in regional and international trade.
Trade Growth Highlights Opportunities and Imbalances
Data from the General Department of Customs and Excise shows that bilateral trade between Cambodia and China exceeded $17.6 billion in the first eleven months of 2025, marking a robust 28 percent increase year on year. However, the figures also reveal structural imbalances, with Cambodian exports to China declining by 6.4 percent to $1.5 billion, while imports from China surged by 33.3 percent to $16.19 billion, widening the trade gap and underscoring the need for greater export diversification and value added production.
Conclusion
China’s dominance in Cambodia’s investment landscape in 2025 reflects deep strategic ties, supportive policies, and strong investor confidence, while rising domestic and regional contributions point to a more diversified growth trajectory. With expanding industrial capacity, improving provincial infrastructure, and broad global market access through multiple trade agreements, Cambodia is well positioned to sustain investment momentum. Moving forward, efforts to promote value added industries, balance trade flows, and attract a wider range of investors will be crucial in ensuring inclusive and sustainable economic growth.