INVESTMENT NEWS IN CAMBODIA

Thailand’s ousted prime minister Thaksin Shinawatra is planning to build a “modern city” in neighbouring Cambodia, replete with a financial district and port, an official said.

The businessman, who owns English football club Manchester City, told Cambodia’s Prime Minister Hun Sen of his plans for Koh Kong province, near the Thai border, during a meeting on Friday in the capital Phnom Penh.

“He did not say how much money will be invested, he just told Prime Minister Hun Sen about his plan,” Hun Sen’s spokesman, Eang Sophalleth, told AFP.

Thaksin, joined by other Thai investors, told Hun Sen the planned city would include a financial centre, hospital, schools and housing, he said.

A port to be used for fixing ships would also be included, he said.

Eang Sophalleth said Hun Sen welcomed the plan, asking Thaksin to work on his project with the Council for the Development of Cambodia (CDC).

Thaksin was toppled in a military coup in September 2006 and went into self-imposed exile in Britain.

The 58-year-old former Thai premier returned to Bangkok in late February after his allies swept back into power in elections late last year.

Source:

http://au.news.yahoo.com//080526/2/170jx.html

Monday May 26, 08:03 PM

http://au.news.yahoo.com/080526/2/p/170jx.html

Monday August 27, 2007

NUNTAWUN POLKUAMDEE
Bangkok Post

Samart Corp is considering divesting its 100% stake in Cambodia Air Traffic Service (Cats), according to unnamed sources.

Cats, which has 22 years remaining on its 30-year concession from the Cambodian government to offer air traffic control services, could fetch a hefty price from foreign buyers, considering the economic and tourist potential of the country.

One source said foreign buyers have suggested a pricetag as high as $1 billion to buy the company.

But advisers to the Vilailuck family, the major shareholders of Samart, are advising that a share sale should only be for a 20% to 25% in Cats.

”The value of the company rests with the concession and monopoly rights. The protection period has a significant amount of time remaining, and the potential value is very high,” one source said. ”There have been a number of offers so far. But no firm buyer has yet been selected.”

Sources said Samart’s investments in Cambodia offer significant upside potential as the Cambodian economy continues to grow and open up to foreign investment. Economic growth over the past three years has averaged 11.4% and is projected to reach 9% this year, compared to just 4% for Thailand.

Cambodia’s favourable location in Indochina also offers benefits to Cats for air traffic moving to Thailand, Hong Kong and Vietnam.

Watchai Vilailuck, the Samart president, said no decision had been made on the company’s policies toward its Cats subsidiary. Samart wanted to expand its I-Mobile brand into the region, given the significantly higher margins offered to the company from sales when compared with handset sales for international brands like Nokia or Motorola.

Thais Plan to Invest More Than $500 Million in Construction of Electric Sky Train Lines in Phnom Penh

Kampuchea Thmey, Vol.6, #1421, 18.8.2007

Phnom Penh: A foreign newspaper said recently that the Bangkok Mass Transit System [BTS] from Thailand plans to build two electric sky train lines in Phnom Penh soon in order to add a transportation system, also guaranteeing safety and reducing the number of traffic accidents in Phnom Penh.

“Officials of the Cambodian Ministry of Public Works and Transport said regarding the construction of electric sky train lines in Phnom Penh, that the Thai company will build two lines costing more than US$500 million. One line is to go from the Cambodian-Japanese Friendship [Chroy Chongva] Bridge to the Preah Monivong Bridge, and another line is to go from Phsar Thom Thmei to the Stung Meanchey Bridge.

“The construction of the electric sky train lines in Phnom Penh will start from 2008 and finish in 2011, and then the train operation will start. In late 2006, experts from Phnom Penh, and experts from China conducted a study along the Russian Federation Boulevard at the Ambassador Junction [leading from this boulevard towards Tuol Kork] and the junction near Tuek Thla, in order to plan the construction of bridges across those junctions to facilitate the traffic and to reduce traffic jams there.

“Officials of the Cambodian Ministry of Public Works and Transport said that in Cambodia, the Royal Government has a project to reconstruct, repair, and develop the two railway lines in the country, that is one line from Phnom Penh to Sihanoukville, and another line is from Phnom Penh to Poipet at the Cambodian-Thai border area, to be linked to the railway in Thailand. The railway line from Sisophon to Poipet is to be repaired with a donation from Malaysia.

“The officials added that the reconstruction and development of the railway lines in Cambodia are, at this time, part of the development project of ASEAN railway lines, linking Singapore, Thailand, Cambodia, Vietnam, and other countries in the region toward Kunming in China. As for the ASEAN railways which will link Cambodia to Vietnam, they will link the Cambodian railway on the north of Phnom Penh across Kompong Cham to the Cambodian-Vietnamese border, and this section has been studied by Chinese experts.

“In Phnom Penh, traffic jams can be reduced somehow at the main entrances to the city, after the construction of the electric sky train lines by the Thai company is completed and the train operation starts.”

Saturday, June 02, 2007

Cambodia’s open door policy is a boon for foreign investors … to the detriment of
Cambodia’s own industry

Phnom Penh holding out an open door close to home

Saturday June 02, 2007
UMESH PANDEY
Bangkok PostThai companies that have gained expertise locally and are looking to venture in neighbouring countries are being encouraged to consider
Cambodia for its low-cost labour force, various privileges and liberal foreign direct investment policy.

“We are more than happy to welcome Thai investors to our country and we offer among the freest and most investor-friendly policies,” Kong Vibol, first secretary of state for the government of Cambodia, said at a briefing in
Bangkok this week.

He said the country was looking to attract companies in agricultural and agro-industries, transport, telecommunications, infrastructure, energy and electrical goods, tourism, mining, labour-intensive and export-oriented processing and manufacturing sectors.

Thai companies including the Charoen Pokphand Group, Siam Cement, Samart Corp, and the TCC Group have already made their mark in
Thailand’s neighbour, with which relations at the national level have sometimes been rocky.

In 2003, the Thai embassy in
Phnom Penh and some businesses were burned by mobs reacting to anti-Cambodian statements erroneously attributed by the local press to a Thai actress. Relations have since improved and the incident was one of the factors prompting
Cambodia to improve its protection for investors.

“Let’s put the past behind us and build the future. That was a political issue and we took responsibility,” said Mr Kong Vibol, referring to the compensation that
Phnom Penh agreed to pay for the 2003 damages.

“Now we provide a guarantee to Thai investors in order to make them more confident.”

Cambodia, he said, was among the freest countries in the region and had set itself firmly on the development path, offering a free hand to foreign investors to set up businesses. They cannot own land but can lease it for 99 years.

As well, he said,
Cambodia had no foreign-exchange controls on current-account transactions.

Cambodia’s economy is among the smallest in the region but it grew by 10.8% in 2006 and 13.4% the previous year. The government expects gross domestic product (GDP) to grow by at least 9.5% this year, Mr Kong Vibol said.
Cambodia’s average growth for the past five years has been 9.8%.

He said that real-sector growth, coupled with low inflation, expansion of the banking system and the overall development of the region had helped
Cambodia expand its economic base.

In addition to having a fast-growing hospitality sector,
Cambodia has become the base for low-skilled and labour-intensive industries such as garments. Its garment export industry grew by 22% in value terms year-on-year and nearly 40% in volume terms to more than $2 billion as of October 2006.

Tourism, which is one of the country’s highest foreign-exchange earners, has also been surging with 1.18 million foreign arrivals or growth of nearly 20% year on year.

To support this growth, the banking system has expanded with private-sector deposits rising close to 18%, while bank lending to the private sector has increased by around 12% from a year earlier.

Cambodia, which had a per-capita GDP of just US$513 in 2006 against $454 in 2005, aims to attract more investment and has set up a “Council for the Development of Cambodia” headed by Prime Minister Hun Sen, as well as creating special economic zones.

Mr Kong Vibol described the Cambodia Special Economic Zone Board (CSEZB) as a “one-stop service provider with an open-door policy to foreign investors”.

The CSEZB gives out information and applications, approves applications, takes care of customs duty and tax exemptions, issues visas and work permits, and registers companies, normally within 31 working days.

The open-door policy has helped attract investment of $12 billion from 1994 to 2006. South Korea is the biggest investor at $2.36 billion, followed by Malaysia at $1.98 billion and
China at $1.58 billion. Thai companies have invested a mere $431 million during that period.

“I therefore encourage Thai investors to participate in our growth story as not only will they reap good returns but companies can benefit from the Generalised System of Preferences privileges with some more developed nations such as Australia, as
Cambodia is still considered among the least-developed countries,” Mr Kong Vibol said. 

http://ki-media.blogspot.com/2007/06/cambodias-open-door-policy-is-boon-for.

Saturday, June 02, 2007

Thai investors are urged to invest across the border … especially in Cambodia

A chance well worth taking

Thai investors are urged to cross the border provided they have done their homework and have interesting products to offerSaturday June 02, 2007

UMESH PANDEY
Bangkok Post
Thailand’s central location and strong economic fundamentals should give its investors the competitive advantage they need to expand their operations into more regional economies, senior government officials and bankers say. “We are centrally located. We are in the area where all the action is taking place, from increased manufacturing to being the link between the emerging global economic giants such as China and India,” Deputy Industry Minister Piyabutr Cholvijarn said in a recent seminar organised by the Export Import Bank of Thailand (Exim Bank).

Thailand, he said, was witnessing a declining manufacturing production index mainly due to the increased costs, an indication that Thai companies now needed to move to other regional markets, especially Cambodia, Laos and Vietnam, to take advantage of the gradual opening of these markets.“These are interesting markets we should try to look into, and I request all of us gathered here to look at opportunities that are beyond the frontiers of the Thai border,” he said at the seminar held to help Thai investors familiarise themselves with prospects and regulations in neighbouring countries.

He said the timing could not be better. The US dollar value of Thai export products had been declining for three years, and the gradual decline in export growth from 20.6% in 2004 to 16.94% in 2006 was an indicator of slipping competitiveness in export markets. The global share of
Thailand’s trade has declined to 1.23% in 2006 from 1.32% in 2004.

“All this is an indication that we are gradually losing our competitive edge. What we need to do is move up the value chain or look for alternative markets for investments,” Mr Piyabutr said.

Citing the case of Italy, which has gradually moved its textile industry into a more value-added, innovative and design-oriented industry, he said Thailand should follow suit.

Other panelists agreed that Thai investors needed to take a bold step forward across the region, as only a handful of companies had so far taken the lead and those that did had been successful.

“The Commerce Ministry … is also looking at ways of promoting Thais to invest in the region and the rest of the world,” said Pisanu Rienmahasarn, the ministry’s deputy permanent secretary.

He added that although the ministry had been pushing for Thais to invest in the neighbouring countries and other emerging Asian markets, very few investors had so far taken up the challenge. Most investors from small and medium-sized businesses, in particular, were fearful of going abroad.

Mr Pisanu, who handles China for the ministry, says fears that China will destroy Thai SMEs and that investing in
China would only burn them were something of the past, and investors who do their homework could succeed.

“Investing in China and losing your shirt is something of the past, as China is becoming a more international market,” Mr Pisanu said.

The Board of Investment (BoI) also has been studying industries in Thailand that have gained the know-how and strength to operate outside the country.

“Our job is not only to help foreign investors come into
Thailand but also to look at Thai industries to move abroad,” said BoI secretary-general Satit Chanjavanakul.

He added that as long as investors did their homework, had good technological processes, and products good enough to sell in the target markets at competitive prices, they should be ready to venture outside Thailand.

Citing the example of the global computer giant Dell, Mr Satit said the company, whose sales were done online, had not been successful in China due to its pricing strategy and the low level of internet penetration there.

“Investors who are willing to take the risk of investing in such markets are rewarded with very high returns as well,” Mr Piyabutr said.

Narongchai Akrasanee, the chairman of the Exim Bank, said most Thais were not investing in neighbouring countries because they had not travelled abroad or studied how to do business there.

Although Cambodia was among the hottest destinations for Thai investors, especially in the hospitality sector, there was still a lot of room for expansion.

“What we would like to see is for the greater Mekong subregion to be the next epicentre for investments,” he said.  http://ki-media.blogspot.com/2007/06/thai-investors-are-urged-to-invest.html