After signing several bilateral, regional and multilateral free trade agreements in recent years,
the Kingdom plans to graduate to the next level to attract foreign direct investment in fast realigning geopolitics and geo-economy. For the country to develop and promote inclusive and sustainable economic growth and raise the standard of living of Cambodians, Cambodia needs to set specific goals and action plans to maximize the benefits of FDI.
Cambodia must adhere to a proactive competition scenario to attract foreign direct investment (FDI) even though it has entered into bilateral and multilateral free trade agreements as the context of FDI has changed comprehensively and complexly in terms of geopolitics and geo-economy, said a senior economic official at the finance ministry.
The official further said that Cambodia must be proactive in setting up specific goals and action plans to maximise attracting FDI which is very necessary for the country to be developed, increase value added in its economy and raise the standard of living of the people, while the region and the world have also faced climate change issues in the changing context.
Vongsey Vissoth, Permanent Secretary of State of the Ministry of Economy and Finance (MEF), said during a sector policy dialogue held at Garden City Hotel in Prek Pnov district in the north of Phnom Penh early this month that Cambodia needs to enhance its competitiveness such as business environment, infrastructure, public governance and climate change responses.
However, Vissoth also pointed out that FDI attraction would actually not be the assignment of the Council for the Development of Cambodia (CDC) alone, but it is that of the government as a whole to attract FDI through institutionalization in the government such as investment promotion even though the CDC has developed and implemented its core functions.
At the event attended by about 300 national and international guests from government ministries, chambers of commerce, research institutes, academic institutions and non-governmental organisations, he said CDC’s core functions include investment promotion, investment approval, post-care services and Industrial Development Policy coordination.
“However, it is still not enough. Besides attracting the volume of investment, we also need the quality of the foreign direct investment such as value-added, job creation and ultimately the long-run economic growth,” added Vissoth, who oversees macroeconomic and fiscal policies, budget, international cooperation and public-private partnership at MEF.
Peter Kusek, WB’s Senior Economist, Global Investment Climate Unit, said in a video presentation that the critical importance of a policy agenda anchored in the ABC model—Attract productive FDI and/or tasks/segments in international production, Bolster existing FDI for re-investment of corporate earnings, increase in investment and expansion of operations and Connect existing FDI to local firms — of Investment Competitiveness.