Cambodia’s large-scale factory investment surged to over $18bil last year

Cambodia’s large-scale factory investment surged to over $18bil last year

The Ministry of Industry, Science, Technology & Innovation (MISTI)

has unveiled a series of remarkable achievements for 2023, setting the stage for ambitious endeavours in 2024. Last year, Cambodia witnessed a net increase of large-scale factories compared to the previous year. These factories employed over one million workers and investment capital surged to $18.56 billion.

These milestones were revealed yesterday during MISTI’s Annual Congress, serving as a platform to present its strategic roadmap for 2024 and beyond.

The meeting was presided over by MISTI Minister Hem Vanndy and also attended by officials from various government ministries as well as the private sector.

The ongoing Annual Congress is spotlighting four key areas crucial to Cambodia’s development – national quality infrastructure, access to clean water, public service reform, and the promotion of science, technology, and innovation in the 7th mandate of the Government.

These areas of priorities underscore MISTI’s commitment to fostering growth, enhancing public services, and driving innovation across all relevant sectors.

“The mandates under MISTI’s purview are ones of the driving forces behind economic growth, playing an important role in job creation and income generation for the Cambodian people,” said Vanndy.

“The sector is expanding economic interactions between manufacturing, processing, agriculture, trade and services that promotes Cambodia’s economic integration, value chains and competitiveness in the region and the world,” he added.

In 2023, Cambodia saw 241 new large-scale factories and 98 factories closed, an increase of 143 factories (7.21%) compared to 2022, making the number of large-scale factories operating nationwide at 2,125, employing 1,040,333 workers.

The Choeung Ek Wastewater Treatment Plant is built at the cost of $24 million by Japan International Cooperation Agency. KT/Khem Sovannara

Investment capital in 2023 was $18.56 billion, an increase of 11.24% compared to 2022. Production value was $16.36 billion, an increase of $531 million (3.35%) compared to 2022.

“The Cambodian economy is forecast to grow about 6.6% in 2024, which will be supported by a number of key economic sectors, of which the industrial sector is projected to grow by 8.5%, compared to 7.7% in 2023. This is due to the expected recovery of the garment sub-sector and continued strong growth in the non-garment manufacturing sub-sector, despite the projected sluggish growth of the construction sub-sector,” Vanndy said.

In promoting small and medium enterprises (SMEs) in 2023, MISTI facilitated the establishment of 5,328 new SMEs and renewed SME licences for 5,158 existing ones.

These efforts underscored MISTI’s commitment to nurturing entrepreneurship and fostering a conducive environment for business growth.

In the field of clean water, the ministry made remarkable strides in the production of clean water both for household as well as business and industrial consumption.

The total production and supply of clean water throughout the country reached over 461 million cubic metres, marking a 16% increase.

By the end of 2023, public water supply authorities and private operators had established a total of 1,307,810 connections, an increase of 8.5% year-on-year, and clean water supply network increased by 3,067 kilometres (11%) to 30,351km.

This has resulted in 6,519 villages out of a total of 10,173 service areas, gaining access to clean water.

Hem Vanndy, Minister of Industry, Science, Technology & Innovation, speaking at the Annual Congress to review the work results in 2023 and the work direction for 2024. KT/Yarn Soveit

In 2023, five water infrastructure projects were completed. Two of these projects were funded by Japanese grant aid totalling $50.7 million, and three projects were concessional loans from various development partners totaling $414.9 million.

Over the past year, MISTI actively promoted the development of national quality infrastructure, including Cambodian standards, metrology and accreditation services.

In 2023, it introduced 36 new standards, through the Institute of Standards of Cambodia, bringing the total number of Cambodian standards to 1,216.

These standards provide technical specifications for products, production processes, and services and support businesses to grow, especially to increase production efficiency, improve product quality, ensure consumer safety, promote public health and support the promotion of trade within the national, regional and international frameworks.

In addition, the ministry provided 966 metrology services covering 39,238 equipment and packaged goods.

Its accreditation arm also continued to play its role in contributing to supporting national and international trade by reducing business costs and technical barriers to trade and sanitary and phytosanitary barriers.

Key progress was also made in the field of science, technology and innovation. The ministry has leveraged information technology to improve efficiency and promote the provision of public services through online systems.

With the establishment of the National Institute of Science, Technology and Innovation (NISTI) in 2020, the ministry has bolstered the promotion of science, technology, and innovation, facilitating the transition to a diversified economy and resulting in various achievements, including the development of roadmaps, research agendas, and guidelines, along with the management and evaluation of STI policies and the organisation of training courses and workshops in this field.

“In addition to the existing priorities in the promotion of science, technology and innovation, the ministry, in 2024, will strive to organise important national and international events such as the 2nd National Day of Science, Technology and Innovation under the theme ‘ SMEs Go STI’, the 20th ASEAN Ministerial Meeting on Science, Technology and Innovation, the 85th Meeting of the ASEAN Committee on Science, Technology and Innovation and Related Meetings for national pride and to contribute to achieving key priorities of the Pentagonal Strategy-Phase 1,” Vanndy said.

In his remarks, Nhim Khemara, MISTI’s Standing Secretary of State, highlighted some reform work which have been implemented within the ministry framework.

They include “Decentralisation and Deconcentration reform” to implement the transfer of functions to the sub-national administration in accordance with the plan of the National Committee for Sub-national Democratic Development (NCDD), the inter-ministerial mechanism for promoting democratic development through decentralisation and deconcentration reforms throughout Cambodia.

He noted the “Public Administration Reform” adhered to three key priority measures including, firstly, implementing a system of recruitment of civil servants with compassion, transparency, fairness, environment and efficiency; secondly, capacity building and institutional achievements to improve the quality of work with discipline, professional ethics, efficiency and effectiveness; and thirdly, the implementation of a system to support the achievement of unity, equity, efficiency and sustainability.

On “Public Financial Reform”, Khemara emphasised the implementation of the action plan in the public financial reform programme, successfully implementing the target indicators 100% compared to the action plan set by the Steering Committee of the Public Financial Management Reform (GSC).

The closing ceremony of the Congress today will be presided over by Prime Minister Hun Manet. Members of the Senate, the National Assembly, and the Government as well as representatives of Development Partners and key figures from the private sector are expected to attend. khmertimeskh

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