The shift reflects a broader transformation in the Kingdom’s investment landscape. Government data shows rising investment in technology, innovation, digital infrastructure and clean energy, while large scale factory investment and employment continue to grow. By strengthening education, technical training and digital readiness, Cambodia aims to move further up regional and global value chains and support its long term goal of becoming a high income economy by 2050.
Investors Are Looking Beyond Traditional Industries
Prime Minister Hun Manet said Cambodia is attracting a growing number of projects focused on advanced manufacturing and emerging technologies. During recent meetings with international business leaders, he noted strong interest in electrical equipment manufacturing and artificial intelligence related investments.
“Investors no longer come to seek land for low-yield agriculture or basic manual work. They are now discussing modern industrial equipment manufacturing, electrical technology and AI training,” PM Hun Manet said.
According to the Prime Minister, this change signals that Cambodia’s workforce is becoming more technically capable and better prepared to support industries that require specialized skills. He added that the country’s participation in international organizations makes human resource development increasingly important for maintaining competitiveness and achieving sustainable growth.
Cambodia’s Industrial Transformation Accelerates
The Ministry of Industry, Science, Technology and Innovation reported that Cambodia had 3,319 large scale operating factories as of June, with total investment reaching approximately $27.8 billion, a 25 percent increase compared with the same period last year.
Industry Minister Hem Vanndy said the country is moving away from competing mainly on low production costs and is instead building an industrial model driven by technology, innovation, productivity and quality. This transition, he said, is helping local industries integrate more deeply into regional and global supply chains.
He described Cambodia’s industrial development as entering a new phase marked by growth in factories, investment, employment and industrial output, reflecting strong investor confidence in the Kingdom’s long term economic prospects.
TVET Seen as Key to Investment Competitiveness
Business leaders also emphasized the importance of technical and vocational education and training. Lim Heng, Vice President of the Cambodia Chamber of Commerce, said TVET is essential for strengthening Cambodia’s position as an attractive investment destination.
“Developing a skilled workforce is essential to attracting quality foreign investment.”
He said the diversification of Cambodia’s industrial base demonstrates the success of the government’s Industrial Development Policy 2015–2025, which helped transform the economy from a labor intensive model into one that is increasingly skill based and technology driven.
New Industrial Development Policy Takes Shape
The government is now preparing the Industrial Development Policy 2026–2035, which is currently undergoing stakeholder consultations and inter ministerial review before final approval.
The new policy aims to accelerate Cambodia’s transition toward a high tech, innovation led and skills driven economy capable of adapting to rapid domestic and global changes.
Ministry of Economy and Finance Secretary of State Hean Sahib said the new framework is necessary to respond to the evolving structure of Cambodia’s industrial sector and changing regional and global trends.
Technology, Clean Energy and Advanced Manufacturing Gain Momentum
Historically, Cambodia relied heavily on garments, agriculture and tourism. Today, the country is increasingly promoting sectors such as electronic and electric devices, automotive assembly, advanced manufacturing, digital infrastructure and clean energy.
Data from the Council for the Development of Cambodia shows that $4.7 billion in fixed asset investment projects were approved during the first half of 2026. The 276 approved projects are expected to create approximately 160,000 jobs.
These projects include special economic zones, renewable energy developments, an electric vehicle assembly plant, a motorcycle factory, a tyre manufacturing facility, a five star hotel and livestock farming operations.
Human Resource Development Remains a National Priority
The government continues to invest heavily in education and vocational training under the Pentagonal Strategy – Phase I. Through the Ministry of Labour and Vocational Training’s “TVET 1.5M” programme, eligible vulnerable youths receive free vocational training and a monthly stipend of 280,000 riel.
More than 270,000 young people had enrolled in the programme by June, according to the ministry.
Prime Minister Hun Manet also highlighted Cambodia’s role as a founding member of the World Artificial Intelligence Cooperation Organization, saying the platform is intended to promote international cooperation in AI development rather than geopolitical competition.
“Our human resources must continue narrowing the skills gap and strengthening their competitiveness,” the Prime Minister added.
Conclusion
Cambodia is making a deliberate shift from a labor intensive economy toward a technology and innovation driven industrial model. By investing in education, technical training and digital skills, the government aims to attract premium foreign investment in advanced manufacturing, artificial intelligence, renewable energy and other high value sectors. The growing number of factories, rising investment approvals and expanding TVET programmes suggest that Cambodia is building the skilled workforce needed to compete in the regional and global economy and support its long term ambition of becoming a high income country by 2050.