- His Excellency Xiong Bo, Ambassador of the People’s Republic of China to the Kingdom of Cambodia,
- His Excellency Cheng Weishan, Vice Chairman of the Standing Committee of Zhejiang Provincial People’s Congress,
- Dong Wenbiao, Chairman of CMIG,
- Neak Oknha Ly Yong Phat, Chairman of LYP Group and Chairman of Cambodian Oknha Association,
- Samdech, Excellencies, Lork Chumteavs, Neak Oknha, Lork Oknha, distinguished guests, ladies and gentlemen!
Today, I have a distinct pleasure and honor to preside over the opening of Cambodia-China Business Forum under the theme Cambodia: The Kingdom of Opportunities along the ‘One Belt, One Road’. Taking this good opportunity, I wish to warmly welcome Your Excellency Cheng Weishan, Vice Chairman of the Standing Committee of the Zhejiang Provincial People’s Congress and Mr Dong Wenbiao, chairman of CMIG for leading the Chinese business delegation of business leaders from renowned and outstanding companies to explore in person investment opportunities and potentials Cambodia has to offer. Similarly, I thank Your Excellencies, Neak Oknha, Lork Oknha, ladies and gentlemen for taking part in this forum.
For honorable guests who come to Cambodia for the first time, you may be surprised by what you witness in Cambodia today. In 1979 when I arrived in Phnom Penh back then, I myself even in a dream, I never ever dreamed of today’s Phnom Penh, with high rise building blocks, good road network and bridges, lights in every corner. Such robust development is a result of the sweat and blood of the Cambodian government and people and it is inseparable from the assistance of our friends, especially China, through the official development assistance both in grants and concession loans. Thanks to all the assistance, I can say that fraternal friend China has helped build the longest road of approximately 1,500-kilometer long and seven bridges of approximately 3,104-meter long in the Cambodia. By the same token, over the past 14 years, electricity supply has increased by 11 folds from merely 180 MW in 2002 to 1,986 MW in 2014. Such remarkable growth was possible thanks to the influx of Chinese investors in various hydropower projects based on BOT.
Samdech, Excellencies, Lork Chumteav, Neak Oknha, Lork Okhna, ladies and gentlemen!
Taking this opportunity, I wish to recall that the relations between the Kingdom of Cambodia and the People’s Republic of China have taken deep root for a very long time. The traditional fraternal relations between Cambodia and China was forged and diligently maintained by the old generation of Chinese leaders namely His Excellency Chairman Mao Tse-Tung, and former Premier Zhou Enlai and other respectable leaders with our late King Father Preah Bat Norodom Sihanouk back in the Sangkum Reast Niyom era. Built on this deep-rooted traditional fraternal friendship, the governments of the two countries have constantly elevated this bilateral relation to a level height as ‘comprehensive strategic partners’ since late 2010. On this ground, the bilateral cooperation between the two countries have grown healthily in all areas of political, economic and socio-cultural fronts as reflected by more frequent exchanges of visit of high level leaders, growth in trade, investments, tourists, and people-to- people exchanges.
For instance, since President Xi Jinping came to his office, I have met him six times, first in 2013 in Beijing, second and third in 2014 in Shanghai and Beijing, fourth and fifth in 2015 in Jakarta, Indonesia, and Beijing, and sixth on 13th-14th October 2016 in Phnom Penh during his office state visit to the Kingdom of Cambodia. During his official state visit, the two parties representing our two countries inked thirty one agreements and protocols including the MoU on Formulating the Outline of Bilateral Cooperation Plan to Jointly Build the Silk Road Economic Belt and the 21st Century Maritime Silk Road, Exchange of note on duty-free treatment covering 97% of the tariff lines, the development of fast-speed transport infrastructure between Phnom Penh and Sihanoukville, Concession agreement for development of Siem Reap Angkor International Airport, MOU on Investment and Development of National Power Grid, and the MOU on Promoting Industrial Investment Key Cooperation Projects in order to jointly foster implementation of concerned projects based on the principle of ‘corporate participation and market orientation in compliance with standard of business conduct and international rules’.
In this context, I highly treasure the traditional fraternal relations and comprehensive strategic partners cooperation between Cambodia and China, a true friend in need who is ready to help each other based on the principle of trust, mutual respect, non-interference and respect for each other’s national and people’s interests.
Samdech, Excellencies, Neak Oknha, Lork Oknha, ladies and gentlemen!
Going forward, the leaders of the two countries have set out the plan to increase the volume of bilateral trade to five billion dollars by 2017. In 2015, trade between the two countries accounted for 4,3 billion USD, a growth of 15,19% , compared to that 3,8 billion USD in 2014. Of this figure, Cambodia’s export to China accounted for 405 million USD, while the China’s imports to Cambodia accounted for 3,9 billion USD, 19,70% growth compared to that of 3,3 billion USD in 2014.
With regard to Foreign Direct Investment (FDI), in accordance with the record of the Council for the Development of Cambodia (CDC) for the last five consecutive years from 2011-2015, China represented the biggest source of foreign investments in Cambodia, with investment capital of 4,9 billion USD, of which some 590 million USD has been invested in the Special Economic Zone (SEZ). In particular, by October 2016, the CDC has recorded 84 projects with the investment capital of appropriately 716 million USD, equivalent to 24,69% of the total investment volume.
In construction sector, from 2000 to August 2016, foreign investors invested in 284 construction projects covering approximately 12,5 million square meters with the capital of approximately 4,3 billion USD, in which Chinese investors was ranked number 1 of 18 other foreign investors.
As for banking sector, banks in Cambodian have grown steadfastly in line with market development. As of December 2015, Cambodia has 36 commercial banks, 11 specialized banks, and 8 overseas bank representative offices, of which 2 are the Chinese commercial banks and 1 specialized bank with the combined capital of approximately 223 million USD.
As for Tourism, Cambodian sees steadfast growth year on year, contributing approximately 12% of the GDP. In 2015, Cambodia received around 4.8 million tourists, generating income of approximately three billion USD and creating jobs for some 620,000 people, of which Chinese tourists accounted for some 700,000, an increase of 24% year on year compared to 2014 and ranked 2nd. In 2016, Cambodia expects 5 million foreign tourists arrivals, of whom Chinese tourists may account for 800,000, an increase of 14,29% compared to that of 2015. Similarly, to date, direct flights between China and Cambodia account for 93 flights per week, with 51 flights to Phnom Penh, 31 flights to Siem Reap and 12 flights to Sihanouk Ville.
Samdech, Excellencies, ladies and gentlemen!
Cambodia now has comparative advantages and key potentials as follows: First, Cambodia enjoys natural endowments such as fertile soil, favorable weather, abandoned natural resources, historical and cultural heritages, splendid landscape of white sand beaches, islands, rivers, tributaries, and natural rainforests. These present enormous potentials awaiting investment and sustainable developments. Second, Cambodia has political and macro-economic stability and national-wide security that has allowed Cambodia to enjoy robust economic development with the average growth rate of 7.7% per annum over the past two decades. And in 2016, the growth rate is projected to be around 7%, while the inflation rate is well under control of no more than 3%. Third, the liberal and open economy without any discrimination between Cambodian and foreign investor is obviously another plus. Cambodia has been wide open on all sectors, including but not limited to banking sector, insurance, telecommunication, that most countries on earth do not allow 100% foreign ownership without national partners. Fourth, Cambodia has abandoned young labour forces. Two thirds of Cambodians are below 35 years of age. The young labours are projected to grow over the next two or three more decades. Fifth, Cambodian is located in Asia where it is considered the most vibrant location in the world and also in ASEAN, a regional block transforming to become a factory of Asia, and sixth, goods produced in Cambodian receive favorable treatments under the agreement ‘Everything but arms’, meaning good produced in Cambodia enjoy entry duty free and quota free to European markets and low tariff rate to other major global markets. Within ASEAN Economic Community, good produced in Cambodia can be exported to ASEAN countries with zero import taxes.
Moreover, Cambodia has moved out of a low income country status to a low middle income country status, a manifestation of progress stemming from economic growth and improved living standard. Nevertheless, the engine of growth now still heavily relies on the traditional sources such as garment industry, tourism, construction and agriculture. It is therefore imperative that we diversify the drivers of growth to new sectors. In light of domestic economic structural changes, evolving regional and global economic architecture, and in order to achieve the goal of economic diversification as well as to augment Cambodia’s comparative advantages, the Royal Government rolled out the Cambodia Industrial Development Policy 2015-2025 in March 2015. This policy not only outlines the new growth model strategies as a vision and blueprints for the industrial development going forward, but it also further attracts foreign direct investment, a major component and key tool toward realizing our goals set out in the new growth strategies.
The above-mentioned policy was rolled out in time with the implementation of President Xi Jinping’s Initiative of Silk Road Economic Belt and 21st Century Maritime Silk Road. These two policies are of good complement to promote infrastructure connectivity, trade, industrial development, and finance, just to name a few for win-win cooperation toward mutual development, friendship, peace, prosperity of our two countries, Cambodia and China.
In this regards, on behalf of the Royal Government of Cambodia and myself, I profoundly appreciate the two partner companies, LYP Group and CMIG for organizing this important and timely forum. The theme of today’s forum Cambodia: the Kingdom of Opportunities along the “One Belt, One Road” is indeed meaningful as it is in time with the implementation of the Belt and Road initiative, a massive mega project that attracts attentions and supports from both public and private sectors both in China and the region alike.
Samdech, Excellencies, Lork Chumteav, Neak Oknha, Lork Oknha, ladies and gentlemen!
All in all, Cambodia is a country full of opportunities and untapped potentials in all sectors with favorable business environment most conducive for investment and businesses. On behalf of the Royal Government of Cambodia, I wish to take this opportunity to reiterate that the Royal Government will continue to welcome and support all investment projects in Cambodia and the Royal Government will continue to do its level best to strengthen and expand economic cooperation, to maintain openness, to develop industrial sector, and to create business and investment environment that is even more favorable and reliable for all investors and businesses.
Finally, I wish you a fruitful and successful forum and I wish Samdech, Excellencies, Lork Chumteav, Neak Oknha, Lork Oknha, ladies and gentlemen every success in your respective endeavors. I now declare the Cambodia-China Business Forum on Cambodia: the Kingdom of Opportunities along the ‘One Belt, One Road’ opened!