Category: Money

Explore opportunities to boost your income in Cambodia with Angkor Times. From insightful blogs on starting a business, investing, and making money online, to updates on the latest trends in startups and SMEs in Cambodia, this category offers practical tips and strategies to help you succeed in the Cambodian market. Stay informed and take your financial journey to the next level.

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Angkor Times
Angkor TimesExperienced
Asked: November 28, 2021In:

Cambodia is the newest addition to the ASEAN family and has been investing heavily in its infrastructure. There are plenty of opportunities for employment and economic growth. One such opportunity is the auto industry. New car sales have been growing ...Read more

Cambodia is the newest addition to the ASEAN family and has been investing heavily in its infrastructure. There are plenty of opportunities for employment and economic growth. One such opportunity is the auto industry. New car sales have been growing steadily and Cambodia’s car ownership rate is on the rise. Now that Cambodia has a new ASEAN market, you can find more cars on Cambodian roads than ever before.

Starting an auto repair business in Cambodia is not as easy as it might seem. There are many variables to take into account, and there are some laws you need to follow. Here are some tips to help you start an auto repair business in Cambodia:

  • You will need a certificate of registration issued by the Ministry of Economy and Finance for your business.
  • You’ll also need permission from the Department of Land Management, the Municipality Office where you plan to register, and any other applicable authorities.
  • You’ll need to establish whether or not the location is suitable for the type of work that you’re intending to do.
  • A lease agreement is needed if you’re planning on renting a property. These are just some factors you need to keep in mind before getting started with your own auto repair business in Cambodia.
Car repair service in Cambodia

Car repair service in Cambodia

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Angkor Times
Angkor TimesExperienced
Asked: October 30, 2023In:

In the landscape of global economic growth, Cambodia is set to make a significant mark in 2024, positioning itself among the top 15 fastest-growing nations. This promising trajectory can be attributed to a combination of factors that reflect the country’s ...Read more

In the landscape of global economic growth, Cambodia is set to make a significant mark in 2024, positioning itself among the top 15 fastest-growing nations. This promising trajectory can be attributed to a combination of factors that reflect the country’s resilience and determination to flourish on the international stage.

According to the October 2023 World Economic Outlook from the International Monetary Fund (IMF), Cambodia is predicted to experience a robust GDP growth rate of 6.1 percent in the coming year. This rate not only outpaces many of its Southeast Asian counterparts but also highlights Cambodia’s potential as a thriving economic force. In the IMF’s ranking, Cambodia holds the 14th position, with Macao SAR leading the chart with an astounding growth projection of 27.2 percent. Other nations in this list of the fastest-growing economies include Guyana (26.6 percent), Palau (12.4 percent), Niger (11.1 percent), Senegal (8.8 percent), Libya (7.5 percent), Rwanda (7 percent), Cote d’Ivoire (6.6 percent), Burkina Faso (6.4 percent), Benin (6.3 percent), India (6.3 percent), The Gambia (6.2 percent), and Ethiopia (6.2 percent).

This remarkable prediction by the IMF stems from a series of positive economic indicators and trends within Cambodia. The nation’s ability to sustain economic growth can be attributed to a combination of factors that are being actively nurtured and cultivated. As we delve deeper into these contributing elements, a brighter picture emerges of Cambodia’s potential as a regional and global economic player.

In late 2023, the IMF convened the 2023 Article IV Consultation with Cambodia, spanning from October 18 to October 31. This consultation facilitated discussions on macroeconomic developments, future economic outlook, and policy considerations with key Cambodian stakeholders. Leading this consultation is Davide Furceri, the IMF Mission Chief for Cambodia. This engagement underscores the international community’s interest in Cambodia’s growth potential and its willingness to support the nation in achieving its economic objectives.

Aaditya Mattoo, the World Bank East Asia and Pacific Chief Economist, expressed optimism about Cambodia’s economic prospects. He highlighted several key drivers behind the nation’s expected growth. Notably, the tourism sector has made a commendable recovery from the lows induced by the pandemic. Cambodia has also witnessed a surge in exports and a resurgence in the agriculture and manufacturing sectors. According to the World Bank Group’s projections, Cambodia is anticipated to achieve a growth rate of 5.5 percent in the current year and is poised for a remarkable growth of 6.1 percent in 2024. Mattoo emphasized that Cambodia’s participation in the Regional Comprehensive Economic Partnership (RCEP) is pivotal for its market access, and the country’s efforts in enacting a new Investment Law and embracing digitalization are steps in the right direction.

However, Mattoo stressed the importance of focusing on skill development and enhancing connectivity, as these elements are integral to a nation’s growth prospects. Emphasizing the need for a concerted effort, he highlighted that the government must ensure that skill development and connectivity remain central to their development goals. These are the building blocks upon which Cambodia’s future growth will be constructed.

Edwin Vamderbruggen, Senior Partner of advisory firm VDB Loi in Phnom Penh, echoed the positive sentiment about Cambodia’s growth. He observed that growth has been evident in specific areas over the past few years. Notably, sectors such as energy production, including renewables, and transmission, as well as financial services such as banking and insurance, have displayed considerable growth. Additionally, the real estate development sector has witnessed high-profile projects, and industrial and public infrastructure initiatives are also on the rise. With more projects in the pipeline, Cambodia is on the cusp of a remarkable transformation.

Vichet Lor, Vice-President of the Cambodia Chinese Commerce Association, recognized the pivotal role played by regional and international initiatives in Cambodia’s economic development. The Regional Comprehensive Economic Partnership (RCEP) and the Belt and Road Initiatives (BRI) have emerged as vital economic tools and financial instruments. These initiatives will enable Cambodia to realize its ambitious goal of achieving high-income country status by 2050. Cambodia’s participation in these initiatives not only enhances its economic prospects but also strengthens its regional and global connectivity.

Lor also underscored the significance of the ASEAN region, of which Cambodia is a part, in driving global economic growth. He emphasized that the economic importance and contribution of ASEAN to global economic growth will continue to expand and extend beyond national boundaries through initiatives like RCEP and the adoption of fintech as a prominent pillar of growth for the next decade and beyond. The projections from institutions such as the Asian Development Bank (ADB), IMF, and the World Bank affirm that the ASEAN region, with its multifaceted and diverse economies, holds the key to promising growth and prosperity for the middle class.

In this context, the Philippines is expected to be the second-fastest-growing economy in ASEAN in 2024, with a projected growth rate of 5.9 percent, while Vietnam closely follows with a growth rate of 5.8 percent. These countries are evidence of the broader trend in the region, where economic growth is not confined to a single nation but is shared across the ASEAN community.

In conclusion, Cambodia’s economic growth prospects for 2024 are promising, with the IMF’s projection of a 6.1 percent GDP growth rate. The nation’s resilience, combined with positive developments in various sectors, makes it a standout performer in the region. With active participation in international initiatives and a commitment to skill development and connectivity, Cambodia is on the path to becoming one of the 15 fastest-growing nations in 2024. As the ASEAN region continues to assert its economic importance on the global stage, Cambodia is well-positioned to be a significant contributor to the region’s continued growth and prosperity.

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Angkor Times
Angkor TimesExperienced
Asked: November 8, 2023In:

“Breaking Records and Tides: Cambodia’s Consumer Credit Soars to $14.93 Billion in Q3, but Storm Clouds Loom” In the ever-expanding world of Cambodian consumer credit, the third quarter of 2023 was nothing short of a blockbuster. The total outstanding ...Read more

“Breaking Records and Tides: Cambodia’s Consumer Credit Soars to $14.93 Billion in Q3, but Storm Clouds Loom”

In the ever-expanding world of Cambodian consumer credit, the third quarter of 2023 was nothing short of a blockbuster. The total outstanding loan balance surged to a jaw-dropping $14.93 billion. It’s a financial crescendo that leaves you in awe, but as the numbers rise, so do the risks. A staggering 20% hike in overdue payments from July to September, reaching a concerning 4.71%, is a stark reminder that this financial high-wire act isn’t without its challenges, as revealed by the data from the Credit Bureau of Cambodia.

Consumer credit, the financial jigsaw made up of personal finance, mortgage loans, and credit cards, continues to be the fuel that keeps Cambodia’s economic engine humming. The overall loan balance may have seen a modest 1.00% uptick from the previous quarter, but it underscores the unshakable confidence Cambodian consumers have in leveraging credit facilities. The number of consumer loan accounts also rose by 1.78%, reaching a grand total of approximately 1.68 million accounts across the country.

But wait, there’s a wave building on the horizon. A concerning trend, like the rumble before a storm, is the increase in the ratio of 30+ Days Past Due (DPD), which now stands at 4.71%, marking a significant rise from the 3.96% recorded in the second quarter of 2023. This metric, measuring accounts with payments overdue by over a month, is a canary in the credit mine, signaling emerging credit risks and borrowers’ financial stress.

The most significant increase in overdue payments was observed in the Plain region, which saw a whopping 25% escalation, followed by the Tonle Sap, Plateau, and Coastal regions. This surge in late repayments suggests a potential ripple effect that could cast a shadow over the overall financial sector if this trend persists.

Now, as the seas grow rough, it’s fascinating to see the way loans are distributed. Mortgage loans, representing just 12.04% of the total number of loan accounts, account for over half of the total outstanding balance, revealing a substantial average loan size in the property sector. On the flip side, personal finance loans, making up a hefty 79.80% of loan accounts, represent just under 44% of the total loan balance. It’s a fascinating interplay of numbers in this financial symphony.

Amidst the crescendo of financial data, consumer credit applications soared by 11% overall, underscoring the enduring thirst for credit. The Personal Finance and Credit Card sectors witnessed applications soaring by 16% and 25%, respectively, showcasing consumers’ appetite for financial flexibility. In contrast, Mortgage Applications took a 29% dip, signifying a shift in consumer borrowing preferences.

Mr. Oeur Sothearoath, CEO of CBC, shed light on the situation, saying, “The demand for consumer credit in terms of both the number and amount of applications has increased. Consumer credit performance was positive in terms of both the number of loan accounts and loan balance this quarter.” However, he sounded a cautionary note, pointing out that “loan quality dropped with an increase in the 30+ DPD ratio from 3.96% in the second quarter of 2023 to 4.71% in this quarter.”

The final act of 2023 and the first half of 2024 will be pivotal in deciding whether this financial opera can continue its symphonic growth while ensuring the financial well-being of its performers – the borrowers. It’s a delicate balancing act, one that will be pivotal in maintaining Cambodia’s economic stability and growth. As the curtain rises on this critical chapter, the question remains: will Cambodia’s economy continue to hit the high notes, or will the rising tides of overdue payments wash ashore, causing a different kind of credit crisis?

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Angkor Times
Angkor TimesExperienced
Asked: May 22, 2024In:

Why Cambodia is Good for Business: Top 10 Reasons Cambodia, often known for its rich cultural heritage and historical landmarks like Angkor Wat, is rapidly emerging as a hotspot for business and investment. Over the past decade, the country ...Read more

Why Cambodia is Good for Business: Top 10 Reasons

Cambodia, often known for its rich cultural heritage and historical landmarks like Angkor Wat, is rapidly emerging as a hotspot for business and investment. Over the past decade, the country has shown remarkable economic growth, making it an attractive destination for entrepreneurs and investors. From a young, dynamic workforce to strategic government policies, Cambodia offers a myriad of opportunities for businesses. In this article, we will explore ten compelling reasons why Cambodia is an ideal place for business.

1. Strategic Location

Cambodia’s geographical location in Southeast Asia makes it a strategic hub for business. It shares borders with Thailand, Vietnam, and Laos, providing easy access to major markets in the region. Additionally, its proximity to the South China Sea facilitates efficient trade routes.

2. Young and Dynamic Workforce

With over 65% of its population under the age of 30, Cambodia boasts a young and vibrant workforce. This demographic dividend is advantageous for businesses looking to tap into a pool of energetic and trainable employees who are eager to learn and grow.

3. Growing Middle Class

Cambodia’s middle class is expanding rapidly, leading to increased domestic consumption. This growth in purchasing power creates a fertile ground for businesses, particularly in sectors like retail, hospitality, and real estate.

4. Pro-Business Government Policies

The Cambodian government has implemented a range of policies to attract foreign investment. These include tax incentives, streamlined business registration processes, and the establishment of special economic zones (SEZs) that offer additional benefits to investors.

5. Competitive Labor Costs

Compared to neighboring countries, Cambodia offers competitive labor costs. This affordability makes it an attractive destination for businesses, especially those in manufacturing and assembly industries seeking to optimize their production costs.

6. Infrastructure Development

Cambodia has made significant strides in improving its infrastructure. Major projects in transportation, energy, and telecommunications are underway, enhancing connectivity and reducing operational costs for businesses.

7. Investment in Technology

The Cambodian government is investing heavily in technology and digital infrastructure. This focus on modernization is creating a conducive environment for tech startups and companies looking to leverage digital platforms for growth.

8. Stable Economic Growth

Over the past decade, Cambodia has consistently achieved robust economic growth, averaging around 7% annually. This stability is a positive indicator for investors, reflecting a resilient and expanding economy.

9. Rich Cultural Heritage and Tourism

Cambodia’s rich cultural heritage and booming tourism industry provide unique business opportunities. The influx of tourists creates demand for hospitality, travel services, and related sectors, driving growth and profitability.

10. Access to Regional and Global Markets

As a member of the Association of Southeast Asian Nations (ASEAN), Cambodia benefits from regional economic integration. Free trade agreements with major economies such as China, Japan, and South Korea further enhance its access to global markets.

Conclusion

Cambodia’s blend of strategic location, youthful workforce, pro-business policies, and robust economic growth makes it an excellent destination for business. Whether you’re a startup looking for a dynamic market or an established enterprise seeking expansion, Cambodia offers a wealth of opportunities.

Share Your Thoughts

What do you think about Cambodia as a business destination? Have you had any experiences investing or doing business in Cambodia? Share your thoughts and insights in the comments below!

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Angkor Times
Angkor TimesExperienced
Asked: November 7, 2023In:

Cambodia Takes the Lead in Digital Economy as ASEAN Negotiates DEFA Deal As ASEAN launches negotiations for the world’s first regional Digital Economy Framework Agreement (DEFA), Cambodia stands out as a key player in promoting digital corridors within the ...Read more

Cambodia Takes the Lead in Digital Economy as ASEAN Negotiates DEFA Deal

As ASEAN launches negotiations for the world’s first regional Digital Economy Framework Agreement (DEFA), Cambodia stands out as a key player in promoting digital corridors within the region. The ambitious initiative was launched during the ASEAN Economic Ministers (AEM) meeting held in Semarang, Indonesia, and seeks to pave the way for the integration of digital trade and digital payments in Southeast Asia. DEFA’s potential impact is substantial, with the successful implementation expected to double the value of the regional digital economy to $2 trillion by 2030, a goal that some experts consider challenging due to the tight timeline set for negotiations.

Cambodia Takes the Lead in Digital Economy as ASEAN Negotiates DEFA Deal
Cambodia Takes the Lead in Digital Economy as ASEAN Negotiates DEFA Deal

ASEAN member states have made significant headway in bilateral digital economy cooperation through arrangements such as cross-border payment agreements. These smaller-scale initiatives, like bilateral Digital Economy Agreements (DEAs), are guiding the development of DEFA provisions on a regional scale. The commitment and momentum displayed by ASEAN Member States (AMS) to move forward with DEFA negotiations are evident, and there is optimism regarding the prospect of DEFA becoming a reality.

Cambodia plays a vital role in expanding digital economy cooperation, having finalized cross-border payment agreements with neighboring countries like Thailand and Laos, with plans for similar agreements with Vietnam and other nations beyond the region. These cross-border payment agreements enable Cambodians to make digital payments for goods and services using KHQR, the universal QR code for Cambodian commercial banks and financial institutions, facilitating remittances and cross-border money transfers. The Director General of Central Banking at the National Bank of Cambodia (NBC) also envisions establishing cross-border digital payment corridors with countries like China, India, Japan, and Malaysia in the near future, with negotiations underway for agreements with Indonesia and Morocco.

Cambodia’s government and the NBC have prioritized promoting digital payments, recognizing their positive impact on social and economic development, as well as facilitating remittances from migrant workers. The adoption of digital technologies has accelerated due to healthy competition among Cambodian banks.

The digitalization of trade documents, such as the ASEAN Single Window and electronic Certificate of Origin form, aims to reduce transaction time, costs, and promote international trade, particularly benefiting small and medium-sized enterprises (MSMEs). These initiatives provide a platform for AMS to learn from best practices and exchange information on relevant topics, promoting seamless cross-border trade within the region.

DEFA covers nine core elements, including digital trade, cross-border e-commerce, cybersecurity, digital identities, digital payments, cross-border data flows, and emerging topics like Artificial Intelligence (AI) governance and ethics. The Framework for Negotiating DEFA sets the stage for discussions and negotiation processes. Thailand chairs the ASEAN DEFA Negotiating Committee, with participation from all ten AMS, and negotiations are set to conclude by 2025, with meetings scheduled for 2023, 2024, and 2025.

The ASEAN Digital Integration Index (ADII) assesses digital readiness and logistics in the region. Different levels of readiness among member states are observed, with some ready for DEFA implementation while others require support. Challenges related to data protection and cybersecurity need to be addressed to ensure a smooth transition to the digital economy, considering the varying regulations and practices related to data protection across borders.

Cambodia’s active role and experience in bilateral agreements position it as a key player in the ASEAN Digital Economy Framework Agreement (DEFA) negotiations, holding the potential to significantly impact the regional digital economy. Nevertheless, challenges like data protection and cybersecurity need to be addressed as ASEAN strives to accelerate digital integration and increase the participation of micro, small, and medium enterprises (MSMEs) in the economy.

Recap

Launching the ASEAN Digital Economy Framework Agreement (DEFA)

ASEAN embarks on negotiations for the world’s first regional Digital Economy Framework Agreement (DEFA). Cambodia stands out as a key player in promoting digital corridors within the region.

DEFA’s Potential Impact

DEFA’s successful implementation could potentially double the regional digital economy’s value to $2 trillion by 2030. Ambitious timeline set for DEFA negotiations, aiming to complete them by 2025.

Leveraging Bilateral Agreements

ASEAN member states have made headway in bilateral digital economy cooperation, such as cross-border payment agreements. Smaller-scale initiatives, like bilateral Digital Economy Agreements (DEAs), guide the development of DEFA provisions.

Cambodia’s Expanding Role

Cambodia actively participates in cross-border payment agreements with neighboring countries and plans to expand to more nations. The use of KHQR (universal QR code) facilitates digital payments, remittances, and cross-border money transfers.

Prioritizing Digital Payments

Cambodia’s government and National Bank are committed to promoting digital payments to boost social and economic development. Competition among Cambodian banks accelerates the adoption of digital technologies.

Beyond Payments: ASEAN Single Window

Initiatives like ASEAN Single Window and electronic Certificate of Origin form enhance trade among member states. The digitalization of trade documents aims to reduce transaction time, costs, and promote international trade, especially for MSMEs.

Core Elements of DEFA

DEFA covers nine core elements, including digital trade, cross-border e-commerce, cybersecurity, digital identities, digital payments, cross-border data flows, and emerging topics like AI governance and ethics. The Framework for Negotiating DEFA sets the stage for discussions and negotiation processes.

DEFA Negotiation Timeline

Thailand chairs the ASEAN DEFA Negotiating Committee, with participation from all ten ASEAN member states. Negotiations are scheduled to conclude by 2025, with meetings set for 2023, 2024, and 2025.

Digital Integration and Challenges

The ASEAN Digital Integration Index (ADII) assesses digital readiness and logistics in the region. Different levels of readiness among member states, with some ready for DEFA implementation, while others require support.

Data Protection and Cybersecurity

Cross-border data flow presents challenges related to privacy and data protection regulations. Stakeholders urged to create cybersecurity awareness and develop a more robust data protection framework.

Financial Inclusion and KHQR

Digital payment initiatives contribute to increased financial inclusion in Cambodia. The KHQR system records substantial transactions, supporting Cambodia’s digitalization goals.

In Conclusion

Cambodia’s active role and experience in bilateral agreements position it as a key player in the ASEAN Digital Economy Framework Agreement (DEFA) negotiations.

DEFA’s potential impact is significant, with the goal of doubling the regional digital economy’s value by 2030.

Challenges like data protection and cybersecurity need to be addressed to ensure a smooth transition to the digital economy.

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ADIIASEAN DEFA negotiationsASEAN Digital Integration IndexBilateral Digital Economy Agreementscambodia digital economyCross-border data flowsCross-border payment agreementsCybersecurity challengesData protection regulationsDEAsDEFA negotiation timelineDigital economy cooperationDigital economy growthDigital payment corridorsDigital payment initiativesDigital readinessDigital trade integrationDigital trade logisticsDigitalization of trade documentsKHQR universal QR codeMSMEsRegional digital economySmall and medium-sized enterprises