As of the end of 2025, Cambodia has 3,083 large factories in operation. This marks a significant increase of 658 factories compared to 2024, representing growth of 27.13 percent, according to the Ministry of Industry, Science, Technology and Innovation. In simple terms, the Kingdom saw nearly 30 percent more large factories in just one year, a clear signal of accelerating industrial expansion.

This growth came despite 42 large factories closing during the year, compared to 26 closures in 2024. The net increase underscores the resilience and momentum of Cambodia’s manufacturing sector, even amid global uncertainty and regional pressures.

Where Are These Factories Located?

The distribution of factories highlights Cambodia’s key industrial hubs. Phnom Penh leads with 895 factories, followed by Kampong Speu with 603, Kandal with 403, Svay Rieng with 327, Preah Sihanouk with 305 and Takeo with 231. These provinces and the capital collectively form the backbone of Cambodia’s industrial ecosystem, supported by special economic zones, logistics connectivity and access to ports and borders.

The presence of large factories inside zones such as the Royal Group Phnom Penh Special Economic Zone reflects a broader strategy to cluster manufacturing operations in well serviced industrial parks that offer streamlined customs procedures and investor friendly infrastructure.

What Do These Factories Produce?

While garment manufacturing remains dominant, Cambodia’s industrial base is no longer limited to light industry. Factories are increasingly engaged in leather processing, paper and paper products, food processing, electrical equipment, rubber and plastic products, furniture, non metallic mineral products and timber goods.

This diversification indicates gradual movement up the value chain. The country is building stronger domestic production chains and integrating more deeply into regional and global supply chains, in line with national economic strategies.

How Many People Do They Employ?

By the end of 2025, factories across Cambodia employed approximately 1.27 million workers. This represents a 9.38 percent increase compared to 2024. The manufacturing sector remains one of the largest sources of formal employment in the country, supporting household incomes and domestic consumption while strengthening social stability.

Why Is the Number Growing So Fast?

Several structural factors explain this rapid expansion. According to economist Hong Vanak of the Royal Academy of Cambodia, reforms to investment laws, improved labour productivity and access to broad export markets have been critical drivers.

Cambodia has also benefited from bilateral and multilateral free trade agreements, competitive labour costs and a young workforce. Government reforms under its seventh mandate have focused on improving the business environment, strengthening competitiveness and promoting higher value added manufacturing.

The industrial sector grew by around 9.3 percent in 2025 and is projected to expand by 7.2 percent in 2026, despite challenges including border tensions with a neighbouring country. The sector has been identified as a strategic pillar under phase one of the Pentagonal Strategy, positioning industry, science, technology and innovation as key engines of long term growth.

What This Means for Investors and Business Leaders?

For investors, executives and policymakers, the figure of 3,083 large factories is more than a statistic. It reflects increasing investor confidence, deeper integration into global supply chains and expanding export capacity. Cambodia is evolving from a predominantly garment based manufacturing economy toward a more diversified industrial landscape.

The continued growth in factory numbers strengthens Cambodia’s export potential and enhances economic resilience. As production capacity scales and industrial capabilities broaden, the Kingdom is positioning itself as a more competitive manufacturing destination in Southeast Asia.

In 2025, the answer is clear. Cambodia is home to over 3,000 large factories and the trajectory remains upward.

Growth Continues Despite Ongoing Challenges

Cambodia’s economy is moving forward with confidence, even as the country navigates challenges related to national sovereignty and territorial integrity. Speaking at the conference reviewing the 2025 results and outlining the work plan for 2026, Hem Vanndy, Minister of Industry, Science, Technology and Innovation, expressed optimism about the country’s economic outlook. He stated, “Despite facing challenges to national sovereignty and territorial integrity, Cambodia’s economy is projected to maintain solid growth, with an estimated 5.2% in 2025 and around 5% of GDP in 2026. This growth is primarily supported by key sectors: the industrial sector, expected to expand by approximately 7.2%; the service sector, by around 3.7%; and the agricultural sector, by 0.9%.” These projections signal resilience and steady progress at a time when global and regional uncertainties continue to test developing economies.

Industry Leads the Way Forward

Among the key drivers of growth, the industrial sector stands out as the strongest pillar of Cambodia’s economic expansion. With an expected growth rate of 7.2% in 2025, industry continues to power job creation, exports, and domestic production. The service sector is also playing a crucial role, projected to grow by around 3.7%, supported by trade, tourism, and other service related activities. Meanwhile, agriculture, though growing at a more modest 0.9%, remains an essential foundation for rural livelihoods and food security. Together, these sectors form a balanced structure that supports both economic stability and long term development.

Rising Income and Stronger Financial Position

Economic growth is translating into tangible improvements for citizens. GDP per capita is projected to increase to 2,858 US dollars in 2025 and could climb further to 3,020 US dollars in 2026. At the same time, Cambodia’s international reserves are expected to strengthen significantly, reaching 25,051 million US dollars in 2025 and 27,989 million US dollars in 2026. These figures reflect not only economic momentum but also improved financial resilience and macroeconomic stability, reinforcing investor confidence and strengthening the country’s ability to manage external shocks.

Foreign Investment Gains Momentum

Foreign direct investment continues to demonstrate strong momentum. According to the Council for the Development of Cambodia, registered foreign investment projects in 2025 reached approximately 10 billion US dollars, marking a remarkable 45% increase compared to 2024. This surge highlights growing international confidence in Cambodia as an attractive destination for manufacturing, innovation, and long term business expansion. Increased FDI inflows also provide capital, technology transfer, and employment opportunities that further stimulate economic growth.

Government Strategy and Long Term Vision

Recognizing the industrial sector as a primary engine of progress, the Royal Government continues to prioritize it as a strategic instrument for implementing the Pentagonal Strategy Phase 1. Industry is viewed not only as a driver of economic expansion but also as a catalyst for social development. This approach aligns with Cambodia’s broader ambition of achieving high income country status by 2050. By maintaining steady growth, strengthening key sectors, and attracting sustained investment, the government aims to build a resilient and competitive economy capable of delivering long term prosperity.

Conclusion

Despite external and internal challenges, Cambodia’s economic outlook remains positive and grounded in strong sectoral performance, rising incomes, and robust investment flows. With industry leading growth, improving financial stability, and clear strategic direction from the government, the country is steadily advancing toward its long term development goals. The coming years will be critical in sustaining this momentum and transforming economic gains into lasting prosperity for all Cambodians.

Special MadeInCambodia counters are now a familiar sight in supermarkets across Phnom Penh and other major cities, reflecting a growing national effort to encourage Cambodians to look inward when they shop. For years, imported goods from China, Thailand, Vietnam, Malaysia, South Korea, and Japan have filled store shelves, shaping consumer habits and perceptions about quality and value. While local manufacturing and agro processing have steadily expanded, many shoppers still associate foreign brands with higher standards and stronger reputations. Against this backdrop, the Ministry of Commerce has launched a nationwide year long MadeInCambodia campaign, aiming to inspire patriotic buying and strengthen domestic consumption. But beyond national pride, the deeper question remains whether the campaign can truly shift consumer confidence and purchasing behavior in a meaningful and lasting way.

A National Campaign Backed by Policy and Promotion

The official launch of the campaign took place on February 14 at Chip Mong 271 Mega Mall, presided over by Commerce Minister Cham Nimul. The initiative involves more than 300 supermarkets, marts, and mini marts in Phnom Penh and across the provinces, with monthly promotional weeks dedicated to highlighting high quality local goods. Speaking at the ceremony, Nimul said, “The MadeInCambodia campaign holds significant meaning for our people, demonstrating their support for national products, Cambodian farmers and producers, and their patriotic spirit.” The campaign is not only about boosting sales. It is designed to showcase the diversity of Cambodian products, improve market linkages for domestic enterprises, and raise awareness about price, quality, and regulatory compliance. At the same time, the ministry is working to prevent the circulation of low quality, defective, and illegal goods, emphasizing that quality assurance requires cooperation from authorities, businesses, and consumers alike. “When consumers are knowledgeable and understand the products they purchase, it creates awareness among producers. Those involved in production, including anyone who may consider engaging in quality fraud will be encouraged to act with integrity. Our main goal is to promote greater consumption of Cambodian products,” Nimul underlined, adding, “More importantly, we want to empower consumers so they have real choices in terms of price, taste, and variety. Consumers must also feel confident to say, ‘This product is not good, I will not buy it.’ When that happens, poor-quality products will automatically disappear from the market.”

Understanding Consumer Perception and Market Realities

Economist Prom Tevy of the Royal Academy of Cambodia explains that products in Cambodia generally fall into three categories: unprocessed goods, minimally processed goods, and highly processed goods. At present, most MadeInCambodia products belong to the first two categories, including agricultural produce, ready to eat food, and household items such as soap and shampoo. These products, she argues, are well within the country’s production capacity and do not require advanced technology. However, Cambodia still relies heavily on imports for highly processed goods such as premium cosmetics, perfumes, electronics, motorcycles, and cars. In a free market economy, consumers with greater purchasing power will naturally seek products from abroad, and imports cannot simply be restricted. Tevy believes that real change will depend on improvements in processing capacity, packaging, pricing, and consistent quality. As Cambodia’s economy strengthens, and as local brands become more competitive in presentation and performance, consumer dependence on imports is likely to decline gradually rather than overnight.

Business Leaders See Opportunity and Constraints

Lim Heng, Vice President of the Cambodian Chamber of Commerce, notes that rising nationalist sentiment and occasional calls to boycott certain foreign goods have contributed to stronger interest in local products. Still, competition remains intense, particularly from ASEAN member states and neighboring countries. He points out that most Cambodian manufacturers still import a large share of their raw materials, which can make domestic production more expensive than importing finished goods. When local raw materials such as agricultural inputs are used, Cambodian producers can compete effectively. However, in sectors that depend heavily on imported components, cost pressures remain significant. For Heng, the timeline for building lasting consumer trust depends on market dynamics. If patriotic buying continues and consumers support local brands even when profit margins are small, momentum will grow. If enthusiasm fades or prices appear uncompetitive, progress may slow.

Local Producers Feel the Shift

On the ground, several business owners say they are already seeing tangible results. Chang Sok Hung, owner of Yang Li Yi Tofu enterprise, recalls a time when supermarket shelves were dominated by imports and Cambodian products struggled for visibility. Today, she says, local goods are far more prominent, and public support has motivated her to focus even more on hygiene, safety, and quality standards. Sar Srey Houch, owner of Ringacam Enterprise, reports sales growth of 20 to 30 percent, driven by increased confidence in Cambodian made goods. “For me, what makes me happiest is that I am able to support Cambodian farmers,” she said. “I am proud to process Cambodian raw materials and sell Cambodian products back to local consumers. This helps keep the financial cycle within our country, allowing our money to circulate domestically.” In Siem Reap, Kun Dama of Dama Prahok handicraft says her sales have jumped by 30 to 40 percent as more Cambodians actively choose local brands. For these producers, the campaign is more than a slogan. It represents expanded market access, stronger brand recognition, and greater economic circulation within the country.

Quality Remains the Decisive Factor

Despite the positive momentum, consumer voices suggest that patriotism alone will not determine buying decisions. Eng Ratha, a Phnom Penh resident, says he regularly buys locally made food, beverages, and household goods. However, for cosmetics, fragrances, and certain personal care products, he still prefers imported brands. “For cosmetics and fragrances, local production has not yet been able to meet market demand or consistently achieve the level of quality consumers expect. The quality remains relatively low,” he said. His view reflects a broader reality: trust is built on consistent performance. For many shoppers, quality, safety, packaging, and brand reputation outweigh emotional appeals. Supporting local products matters, but only when those products deliver comparable value.

Conclusion

The MadeInCambodia campaign has already strengthened national awareness and improved visibility for local producers. It has sparked conversations about economic independence, consumer responsibility, and domestic value creation. Yet consumer confidence cannot be mandated. It must be earned through reliable standards, competitive pricing, attractive packaging, and transparent regulation. If businesses, policymakers, and consumers continue working together, the label MadeInCambodia may gradually evolve from a patriotic gesture into a genuine mark of trust and quality in the marketplace.