Cambodia’s trade landscape has demonstrated remarkable resilience and growth, even amidst a challenging global economic environment. As the nation navigates through a post-pandemic recovery, its international trade relationships have continued to flourish. In the first 10 months of 2024 alone, Cambodia’s trade volume with international markets exceeded $45 billion, reflecting an impressive 16% increase compared to the same period in 2023. This robust performance sets the stage for what could be a promising 2025. But what exactly does the Ministry of Commerce anticipate for the future of Cambodia’s trade?

A Strong Foundation for Growth

According to His Excellency Pen Sovicheat, Secretary of State and Spokesperson for the Ministry of Commerce, Cambodia’s economic performance is expected to further improve in 2025. He attributes this optimism to the recovery of key sectors, including tourism, construction, and agriculture. The Ministry is actively working to strengthen trade relationships with established markets while exploring opportunities in new regions. This dual strategy aims to position Cambodia as a competitive player in the global market by leveraging technological advancements, fostering favorable market conditions, and diversifying its product offerings.

Key Trade Partners in 2024

The year 2024 has been a landmark period for Cambodia’s trade. As of October:

• China emerged as Cambodia’s largest trading partner, with trade volume exceeding $12 billion, marking a 23% increase year-over-year.
• The United States followed as the second-largest partner, with trade valued at over $8 billion, reflecting a 9% growth.
• Vietnam maintained its significant role, with bilateral trade reaching over $6 billion, an impressive 21% increase.

These figures highlight the strength of Cambodia’s international partnerships and its ability to capitalize on regional and global trade networks.

Outlook for 2025: Opportunities and Challenges

While 2024 has been a year of growth, the Ministry of Commerce foresees further potential in 2025, albeit with some challenges. HE Pen Sovicheat emphasized that global economic stability will play a crucial role. He noted that the rising price of crude oil has been a significant impediment to global economic recovery. However, he expressed optimism that oil price stabilization could alleviate pressures on the global economy, thereby creating a more conducive environment for trade.

Diversifying Trade Markets

Cambodia’s strategy for 2025 includes expanding its trade networks beyond traditional partners. While the United States, the European Union, and RCEP countries remain key markets, the Ministry of Commerce is setting its sights on emerging economies in Africa, the Middle East, and Latin America. These regions offer untapped opportunities for Cambodian products, particularly in sectors such as agriculture, textiles, and electronics.

Enhancing Export Competitiveness

To remain competitive, Cambodia plans to focus on:

• Technological Integration: Leveraging technology to improve supply chain efficiency and production processes.
• Product Diversification: Expanding the range of goods and services offered to international markets.
• Improved Trade Agreements: Strengthening existing trade agreements and negotiating new ones to reduce tariffs and trade barriers.

Sectoral Contributions to Trade

Tourism and Construction

The gradual recovery of the tourism and construction sectors is expected to significantly contribute to Cambodia’s trade performance in 2025. With the reopening of borders and increased international travel, tourism revenues are likely to surge, providing an additional boost to related industries such as hospitality and retail. Meanwhile, construction activities are set to pick up, driven by domestic infrastructure projects and foreign investments.

Agricultural Exports

Agriculture remains a cornerstone of Cambodia’s economy. In 2025, the government aims to increase the export of high-value crops such as rice, cassava, and cashew nuts. Efforts to modernize agricultural practices and improve product quality will be key to accessing premium markets in Europe and Asia.

Manufacturing and Textiles

The manufacturing sector, particularly textiles and garments, continues to be a major contributor to Cambodia’s exports. By adopting sustainable practices and meeting international labor standards, Cambodia seeks to enhance its appeal to socially conscious consumers and businesses worldwide.

Geopolitical Considerations

The global geopolitical landscape will inevitably influence Cambodia’s trade in 2025. While uncertainties persist, HE Pen Sovicheat remains optimistic, noting that major export markets such as the United States and the European Union have so far been minimally affected by geopolitical tensions. However, the Ministry of Commerce is closely monitoring developments to mitigate potential risks.

RCEP and Regional Trade

The Regional Comprehensive Economic Partnership (RCEP) has been a game-changer for Cambodia, opening up new avenues for trade within Asia-Pacific. As one of the largest free trade agreements in the world, RCEP provides Cambodia with preferential access to markets such as China, Japan, South Korea, and Australia.

Sustained Growth in Bilateral Trade

The strong performance of Cambodia’s bilateral trade relationships in 2024 sets a positive tone for 2025. The Ministry of Commerce aims to build on these successes by enhancing cooperation with key partners:

• China: Strengthening ties with China, Cambodia’s largest trading partner, will remain a priority. The two countries are exploring opportunities in technology, agriculture, and infrastructure development.
• United States: Cambodia plans to increase its exports of textiles, footwear, and agricultural products to the U.S., supported by the Generalized System of Preferences (GSP).
• ASEAN Neighbors: Collaboration with Vietnam, Thailand, and other ASEAN members will focus on regional supply chain integration and cross-border trade facilitation.

Vision for the Future

Cambodia’s trade in 2025 will likely be shaped by its ability to adapt to changing global dynamics. By leveraging its strengths, addressing challenges, and seizing new opportunities, Cambodia is poised to solidify its position as a rising player in international trade.

Concluding Thoughts

As Cambodia looks ahead to 2025, the outlook for trade remains bright. With strategic initiatives, a focus on diversification, and a commitment to sustainability, the nation is well-equipped to navigate the complexities of the global market.

What are your thoughts on Cambodia’s trade prospects in 2025? Share your insights and join the conversation!

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Despite being outlawed in Cambodia since 2019, online gambling remains a persistent and growing concern. Recent tragic incidents have highlighted the devastating social impacts of this illegal activity, which exploits legal loopholes and leverages aggressive advertising strategies to target Cambodians. This blog delves into the reasons behind the continued prevalence of online gambling in Cambodia, the methods used to entice citizens, and the urgent need for stronger measures to combat this issue.

1. Exploiting Loopholes in Cambodian Law

Cambodia’s gambling laws prohibit all forms of gambling by its citizens, including online gambling. However, a significant loophole exists: while gambling itself is illegal, there is no specific legislation banning advertisements for online gambling. This legal gray area enables operators, often based abroad, to promote their platforms freely, luring unsuspecting Cambodian citizens into financial traps.

The 2019 directive by former Prime Minister Hun Sen banned online gambling operations to protect the country’s reputation and prioritize sustainable development through tourism. However, the lack of comprehensive enforcement mechanisms allows illegal operators to adapt and thrive.

2. A Booming Regional Gambling Industry

Southeast Asia is home to a flourishing online gambling industry, driven by advanced technology and the increasing availability of mobile internet. Cambodia’s coastal city of Sihanoukville was a hub for online gambling between 2016 and 2018, fueled by foreign investment and Chinese gamblers seeking to evade China’s strict anti-gambling laws. During its peak, online gambling brought economic benefits but also a surge in crime, including human trafficking, fraud, and gang violence.

While the Cambodian government took significant steps to shut down these operations in 2019, the regional demand for online gambling has shifted the focus of operators to new targets: Cambodian citizens themselves.

3. Sophisticated Advertising Strategies

Illegal gambling operators rely on aggressive and innovative advertising tactics to attract users. According to investigations, there are three primary methods used to target Cambodians:

Celebrity Endorsements

Operators pay local celebrities, such as singers, athletes, and social media influencers, to promote their platforms. With promises of “always winning” and lucrative rewards, these endorsements create a false sense of legitimacy and allure. Many celebrities unknowingly contribute to the problem, drawn by the high payouts for their participation.

Social Media Platforms

Social media, particularly Facebook and TikTok, serves as the main advertising channel for online gambling syndicates. Thousands of accounts and pages regularly post advertisements, often using paid promotions to reach vast audiences. Despite efforts by Cambodian authorities to shut down these pages, new ones continuously emerge, ensuring a steady stream of exposure.

Pornographic Content

Shockingly, some operators exploit illegal content, such as pornography, to advertise their platforms. Through private Telegram groups, users gain access to explicit materials in exchange for subscribing to or promoting gambling websites. This deeply unethical practice exacerbates societal harm, particularly affecting women and children.

4. Tragic Consequences of Gambling Debts

The societal impact of online gambling came into sharp focus in November 2024, with two heartbreaking incidents.

• The Death of Nob Tola: A former national football player, Tola tragically took his own life, leaving behind a message expressing regret over the financial ruin caused by gambling debts.
• Family Tragedy in Kandal Province: A primary school director, overwhelmed by gambling losses, murdered his family before taking his own life. This devastating event highlighted the destructive ripple effects of gambling addiction.

These tragedies underscore the urgent need for government action to curb gambling advertisements and address the root causes of addiction.

5. Why Are Cambodians Being Targeted?

Several factors make Cambodians vulnerable to online gambling:

• Limited Financial Awareness: Many citizens are unaware of the risks and manipulations inherent in online gambling.
• Lack of Regulation: The absence of strict controls on advertising creates an open market for illegal operators.
• Economic Hardship: Struggling families may see gambling as a quick way to improve their financial situation, only to fall deeper into debt.

6. Government and Community Response

In response to rising public concerns, the Cambodian Ministry of Interior recently issued a directive to halt all forms of illegal gambling promotion. Local authorities have been tasked with monitoring and preventing the spread of such content, as part of a broader “Safe Villages and Communes” initiative aimed at fostering secure communities.

The directive also emphasizes public education to highlight the dangers of gambling. However, experts argue that enforcement alone is insufficient; greater efforts must focus on identifying and dismantling the foreign-operated syndicates behind these schemes.

7. Expert Recommendations

Social analyst Tong Soprach calls for stricter regulation of online gambling advertisements and more robust measures to tackle the operators.

“We know the ones behind these illegal operations are often foreigners,” he notes. “The authorities must focus on tracking and apprehending them through undercover operations and advanced investigative tactics.”

Soprach also stresses the importance of addressing social vulnerabilities that make citizens susceptible to gambling schemes. Financial literacy campaigns, community engagement, and counseling services for those affected are essential components of a long-term solution.

Time for Decisive Action

The unfettered targeting of Cambodians by online gambling operators is a pressing issue with far-reaching social consequences. While the Cambodian government has taken steps to curb gambling, more comprehensive actions are needed to close legal loopholes, enforce existing laws, and educate the public about the risks.

Online gambling not only drains the financial resources of individuals but also destabilizes families and communities. Tackling this problem requires a unified effort from the government, civil society, and citizens to create a safer, gambling-free Cambodia.

What Do You Think? How can Cambodia better address the challenges of illegal online gambling? Share your thoughts in the comments below.

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As international capital continues flowing into Southeast Asia, ASEAN is increasingly seen as the next global economic growth center. In recent years, Cambodia’s economic growth has strengthened its role in the region. According to the International Monetary Fund, Cambodia is projected to lead Southeast Asia with a growth rate of 6.1% in 2024. This raises the question: from the perspective of international financial experts, could Cambodia be on track to become the next regional financial center? Mr. Ong Chee Keong, CEO of Singapore Global Trust, is optimistic. He believes that if everyone works towards a shared goal, Cambodia certainly has the potential to become a financial hub for the region.

Political Stability: The Foundation of Cambodia’s path to becoming a financial hub

Political stability is key to attracting both domestic and foreign financial investment and encouraging financial institutions to set up in Cambodia. By maintaining consistent and stable policies, the Cambodian government provides a strong political foundation and supportive environment for the long-term growth of its financial sector. This stability allows investors to feel more secure amid global uncertainties.

Read More: How Would Cambodia Change If Its Railway System Were Fully Developed?

Cambodia’s political stability and consistent policies have been key drivers of its development. Former Prime Minister Hun Sen, who led the country for 38 years, greatly advanced Cambodia’s growth, and the new government under Prime Minister Hun Manet is building on this foundation. In addition to maintaining existing policies, the new administration has introduced fresh initiatives to strengthen economic strategies, notably the “Pentagon Strategy,” which aims to diversify the economy. This strategy includes ongoing improvements in transportation, electricity, telecommunications, and water infrastructure, as well as initiatives to build a digital government and develop local talent​ efforts that all strongly support Cambodia’s aspiration to become a financial hub.

Mr. Ong Chee Keong noted, “From my personal experience, Cambodia’s airport services have been upgraded at least three times between 2017 and 2024. On my previous visit, there was no option for online processing, but now I can enter Cambodia using an electronic entry card filled out online. This pace of development is impressive, and it strengthens my belief that, with the united efforts of the government and the people, Cambodia can indeed become Southeast Asia’s next financial center.”

The absence of foreign exchange controls: A key factor for Cambodia’s emergence as a financial hub in Southeast Asia

The lack of foreign exchange controls is a crucial condition for any region aspiring to become a financial center. Cambodia stands out as one of the most open countries in Asia to foreign investment, with a highly open economy and no foreign exchange restrictions. This environment allows investors to move their capital in and out of Cambodia with greater confidence and freedom, paving the way for significant inflows of capital as the economy develops.

Read more: Can I Make Money in Cambodia While I’m Sleeping?

Mr. Thierry Tea pointed out that while Cambodia’s capital market is still in its early stages, it possesses immense growth potential, making it an attractive opportunity for investors now, with the possibility of substantial returns in the next ten years.

Currently, global manufacturing is rapidly shifting, and Southeast Asia is on track to become the next global economic development center. Among Southeast Asian nations, Cambodia is emerging as a preferred investment destination due to its political stability, open foreign investment policies, youthful population dividend, and low labor and land costs.

The concentration of foreign investment will drive Cambodia’s industrial and economic transformation, transitioning from labor-intensive industries to high-tech sectors. “Cambodia’s manufacturing has evolved from an initial focus on textiles to include emerging industries with high added value, innovation, and competitiveness, such as auto parts, tires, and photovoltaic materials, introducing skill-intensive industries that bring advanced production technologies and management experience to Cambodia,” said Mr. Jack Lee, founder and CEO of Smile Mall, who has been deeply involved in e-commerce in Cambodia for six years and is well-acquainted with the Southeast Asian market and adept at tapping into its potential.

Strong Economic Growth Fuels the Acceleration of Cambodia’s Financial Hub Development

Historically, the rise of international financial centers like London, New York, and Singapore has been driven by their unique advantages and continuous government efforts. Currently, Cambodia, with over eight consecutive years of GDP growth exceeding 7%, has become one of the fastest-growing economies in the world. This remarkable economic performance, combined with its geographical location, status as a transportation hub, favorable policies, and diversified economic development strategies, provides strong momentum for building a financial center, attracting more and more investors to this “new tiger of Asia.”

Moreover, local large groups and seasoned investors are confident in Cambodia’s economic growth.

Mr. Chy Sila, Chairman of the well-known Cambodian company Sabay Digital Group and founder of Kirisu Milk, stated that Cambodia holds immense potential as an emerging investment hotspot, continuously capturing the attention of global investors. There are abundant business opportunities and development space to explore across various sectors.

“Twenty-five years ago, I invested in the restaurant industry; in early 2007, I ventured into the internet sector; later, I entered the film industry, and now I’m investing in agriculture. Many might wonder why I diversify like this, but I believe there are vast potential business opportunities waiting to be uncovered in every sector in Cambodia. Especially with the new government’s Pentagon Strategy clearly identifying agriculture as one of the key industries for development, it provides investors with clear direction and goals.”

Read more: Will ADB’s Support Unlock Cambodia’s Growth Potential?

Accelerating Infrastructure Development and Talent Training to Support the Financial Hub
Situated in the heart of ASEAN, Cambodia shares borders with Thailand, Laos, and Vietnam, making it a vital transportation hub for connecting Southeast Asian countries and serving as a gateway to significant global markets. This strategic position offers investors ample opportunities for establishing manufacturing operations in Cambodia, further enhancing the country’s economic standing in the region.

In recent years, the Cambodian government has launched a comprehensive multi-modal transport plan, continuously advancing infrastructure development in areas such as roads, railways, waterways, aviation, and ports. The aim is to build a modern logistics system and transform Cambodia into a regional logistics hub by 2030.

Mr. Thierry Tea, Vice President of OCIC Group and CEO of Negocia Capital, highlighted the significant efforts made by the Cambodian government, under the leadership of a younger generation, to drive national economic growth and align with international standards. Notably, important progress has been made in areas such as digital transformation and international cooperation.

Mr. Thierry Tea noted that next year, the new Phnom Penh International Airport, designed by the renowned British firm Foster and Partners, will begin operations. Coupled with the launch of the “Bakong Tourist App” by the National Bank this year, these changes will greatly enhance convenience for international tourists and investors.

Stable Logistics To Facilitate Financial Operations

Particularly noteworthy is the announcement of the construction of the Funan Techo Canal, which will connect the Mekong River in Phnom Penh to the Gulf of Thailand, capturing global attention. Additionally, infrastructure projects are underway, such as the deep-water port in Sihanoukville to increase port capacity, the new container terminal to significantly reduce logistics costs, and the completed Phnom Penh-Sihanoukville Expressway along with the ongoing Phnom Penh-Bavet Expressway, as well as various new airports and upgrades to existing ones. Once completed, these projects will significantly modernize Cambodia’s infrastructure, strengthening its connections with the world, and providing efficient communication networks and stable logistics to facilitate financial operations.

At the same time, the Cambodian government is actively nurturing financial professionals, increasing investment in education, and continuously improving the education system. Policies are being implemented to provide support, practical opportunities, and career guidance, aimed at developing finance professionals with international perspectives and expertise.

Moreover, Cambodia is also implementing programs to attract financial talent, including offering incentives, enhancing communication and collaboration with international financial institutions, and showcasing market potential. As Cambodia’s economy grows, it is expected that more financial professionals will be drawn to the country, injecting new vitality into Cambodia’s financial market.

Currently, the government is actively promoting and accelerating Cambodia’s emergence as the next financial hub. For Cambodian enterprises, finding ways to seize the opportunities presented by the capital market in the coming years is a topic worthy of deep consideration!

This article was first published by Cambodia Securities PLC.

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