09:29 | 08/04/2014 Economy
(VEN) - Vietnamese direct investment in Cambodia has increased sharply in recent years. Vietnam Economic News’ reporter Nguyen Hoa spoke with Le Minh Dien, Deputy Director of the Department of Foreign Economic Relations under the Ministry of Planning and Investment.
Viettel is one of Vietnamese successful businesses in Cambodia
What about Vietnamese investment in Cambodia so far?
Vietnam currently has 128 investment projects with total registered capital of US$3.068 billion in Cambodia. Most projects are in agriculture and forestry accounting for 50.58 percent of total registered capital; energy 27.05 percent; finance, banking and insurance 8.7 percent; and telecommunications 5.1 percent. The rest are in processing, manufacturing, transport and warehouse, export and import, health and construction accounting for about two percent of total registered capital.
Vietnamese investment in Cambodia has increased sharply in recent years. What advantages does the Cambodian investment environment offer to attract Vietnamese businesses?
Cambodia has integrated with the global market via its open trade policies since it joined the Association of Southeast Asian Nations (ASEAN) in 1990 and the ASEAN Free Trade Area (AFTA) and the World Trade Organization (WTO) in 2003 becoming an attractive investment destination in the region.
Cambodia has also attracted Vietnamese investors as Vietnam and Cambodia share a 1,137km borderline with 10 international border crossings, 12 major border crossings, 25 secondary border crossings and 9 border economic zones which have facilitated goods exchange between the two countries.
In addition, the investment environment in Cambodia has attracted foreign businesses due to the Cambodian policy on free income tax during a period from six to nine years and an income tax rate of 20 percent per year after that. Investors in Cambodia are also exempted from import taxes and are free to transfer profits to their home country.
You have been working in Cambodia for many years. What areas of investment do you think that the government of Cambodia would encourage?
The Royal Government of Cambodia has plans to encourage investment in agriculture (focusing on rice cultivation, husking and agricultural processing), infrastructure, real estate, banking and telecommunications.
In what areas do you think Vietnamese businesses could reap success in Cambodia? What they should do to be successful in this market?
Vietnamese businesses could succeed in several areas in Cambodia including trade and distribution; agricultural production and processing; finance, banking and insurance; tourism and accommodation services; transport and warehouses; and telecommunications.
In addition, to succeed in Cambodia, Vietnamese businesses need to carefully study the market, closely cooperate with the Vietnamese Trade Office and Vietnamese banks in Cambodia. They also need to prepare sufficient capital for their projects./.
According to the Ministry of Planning and Investment, Vietnamese businesses have expanded their investment in more than 60 countries and territories globally with total registered capital of more than US$15 billion. Of these, Cambodia took second place with more than US$3 billion.