The government is gathering input from the private sector and development partners to amend the country’s Investment Law and make the country a more attractive destination for foreign investment.
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It will be the second amendment to the Investment Law, which was promulgated in 1993 and first revised in 2003.
Speaking at a public consultation held yesterday that brought together around 70 representatives of the private sector, development partners and law firms, Sok Chenda Sophea, Secretary General of the Council for the Development of Cambodia (CDC), said the government wants to hear from all actors to create an Investment Law that suits the country’s current situation.
“This is an effort to create a more favourable investment climate,” he said.
“The goal is to have a very competitive and attractive Investment Law; a law in line with the regional context and the needs of the country,” he said, adding that the existing Investment Law was already very open.
“It is very important to have the participation of the private sector, development partners, research firms as well as legal consulting firms,” he added.
According to Mr Chenda Sophea, CDC has already conducted different studies to revise the law and consulted the Japan International Cooperation Agency (JICA), the Organisation for Economic Cooperation and Development (OECD), and the International Finance Corporation (IFC) to know more about the investment laws of other countries in the region.
Stephen Higgins, managing partner for consulting firm Mekong Strategic Partners, told Khmer Times the amendment was good news as the law was already quite old.
“The Investment Law is 14 years old, so it does make sense to review it. It is also relatively basic, although that isn’t necessarily a bad thing.
“Overall, the investment framework here is better than most neighbouring countries. However to help support further investment, a commercial legal system that investors have confidence in would be a major positive, along with a robust appeals system for tax disputes,” he added.
Last month, Prime Minister Hun Sen, speaking during the 40th anniversary of the victory over the Khmer Rouge at Phnom Penh’s Olympic Stadium, said that the government has transformed the country since the collapse of the Khmer Rouge regime into a nation that attracts billions in foreign direct investment (FDI) every year.
“Peace, security and political stability over the last two decades has allowed Cambodia to develop economically and socially,” Mr Hun Sen said. “Cambodia is now considered by local and foreign investors, as well as many international financial organisations, as a very good and competitive place for business and investment.”
In 2019, the Kingdom’s economy will grow at a rate of 7 percent, slower than last year’s 7.3 percent, according to the National Bank of Cambodia (NBC). The inflation rate will remain at 2.6 percent in 2019, the Central Bank said.
According to NBC, in 2018 FDI expanded by 12 percent, mostly going into the banking, real estate, and garment sectors.