The number of passengers who have entered Cambodia’s three international airports between January and November 2024 is 4.7 million according to a report from the State Secretariat of Civil Aviation (SSCA). As always it’s good to see the data heading in the right direction but pre-pandemic levels need to be the benchmark by which we compare growth – the SCCA is projecting a 67 per cent growth in air traffic for this year compared to 2019.
So how are tourists and investors being encouraged to visit and explore the Kingdom as we set off on another peak period for tourism at the end of November and what long-term plans are in place to ensure there is confidence and strategic plans in place which will benefit the economy of which the real estate sector remains a key pillar.
The Little Things Matter – Improving Seamless Arrivals and Payments
Credit needs to be given when it’s deserved. Since the pandemic, the Cambodian government has greatly improved the visitor arrival experience and the ongoing digitisation needs to be applauded. This summary of the Digital Economy and Society Policy Framework 2021–2035 provides a clear overview of the path ahead.
Even though the journey from plans being announced to flawless execution has some way to go, visitors to Cambodia can now:
• Pay for visas online (for many countries)
• Pay on arrival by credit card rather than cash to improve transparency
• Paperless arrival and customs forms via the Cambodia eArrival app (which still needs some improvement)
• Bakong Tourists app has the potential to be a game changer but this soft phase has had mixed feedback from those arriving we have spoken to.
There are those who have called for the government to scrap the visa fees but in an economic climate where the government has collected less taxes and seen decreasing budgets – it is probably revenue it can ill-afford to dispose of.
There have been again (the plan recurs every few years) the calls for a Shengen-style visa for the ASEAN region. Various reports suggested that Cambodia will ‘consider’ Thailand’s initiative to simplify cross-border travel through the visa policy known as “6 Countries, 1 Destination”.
As part of a seamless digital arrival experience (via the three international airports at least), there is a multi-layered improvement for all involved but the processes and exact payment details need to be clearly and continuously communicated to all stakeholders.
Economic Reform And Investment
Deputy Prime Minister of Cambodia, Sun Chanthol has been reading from the same playbook for some time and recently again outlined the country’s strategic vision for economic growth. There is an emphasis on international investment and economic reform.
There has been a deliberate move to diversify investment partners and he said Cambodia’s economic policies are open to all nations, stating that they “do not discriminate” against investors from other regions, including the EU, Canada, and the United States.
You can also read here about the latest changes to taxes and beneficial property updates, which are hoped to help housing developers and property owners with the hope that the range of introduced measures will also drive the growth of the real estate sector.
In an interview with Forbes, Sun Chanthol said:
• There has been a significant rise in foreign investment, including a 75% increase in the number of projects and a remarkable 162% increase in investment capital.
• The private sector is a “key engine for economic growth”.
• A need to pursue significant shifts in industries – as outlined in the national Industrial Policy 2015–2035 plan.
• Infrastructure investments are ongoing (see more below).
• Cambodia has the most liberal investment regime in ASEAN and foreign investors can own 100% of their businesses across all economic sectors, foreigners can also own certain types of property and there are mechanisms such as Trusts for owning land.
On the infrastructure, there is a vast and grandiose plan to improve the transportation networks by improving roads, airports, and ports with the idea that the enhanced connectivity can facilitate trade and tourism, making it easier for investors and tourists to access various regions of the country.
For not the first time, estimated figures of investment capital of around US $36 billion to implement the master plan for infrastructure developments in short- and medium-term projects 2023-2027 and long-term projects 2028-2033 have surfaced based on a report by the Ministry of Public Works and Transport.
The updated report has identified 174 priority projects:
• 94 road projects
• 8 railway projects
• 23 river transport projects
• 20 sea transport projects
• 10 air transport projects
• 15 logistics projects
• 4 additional projects
With the US $1.2 billion Techo Takhmao International Airport (TIA) in Phnom Penh due to open in 2025, we all hope there is a great strategic communication roadmap being scrutinised to properly explain the transport options, the arrival and departure process and other questions on accommodation etc. It is the biggest infrastructure project to open since…. well the Siem Reap-Angkor International Airport (SAI) opened to a flat response.
That experience, if anything, should have laid out the foundations of how to do a better job this time around. You only have one chance of making a first impression and Cambodia needs its visitors to have an excellent experience as they are the best marketers of the country as they travel beyond the borders and share their experiences.
International Reputation Is Important
In November 2024, Cambodia’s National Assembly unanimously approved the reappointment of Prak Sokhonn as foreign minister and deputy prime minister with the Prime Minister adding it was part of a need to adhere to the principles of independence and international law to safeguard the nation’s core interests.
The elephant in the room is the damaging and corrosive reputation Cambodia has been receiving due to the human trafficking and scam centres in the Kingdom. The communication and the way that it has been handled could be better – this writer travels a lot and it’s now the most commonly asked question I receive when I say I live in Cambodia – people are asking about the scam centres and whether it is safe.
Chou Bun Eng, secretary of state at the Ministry of Interior and permanent vice-chair of the National Committee for Counter Trafficking (NCCT) said in November 2024 that Cambodia is addressing the complexities of “human trafficking carried out by foreign nationals employing diverse and deceptive methods”.
“Some human trafficking cases involve foreign offenders deceiving citizens of other nationalities or Cambodian citizens. In some instances, offenders target victims of the same nationality. These cases involve various forms of trafficking, surrogacy, threats and tactics carried out online, by phone or in person,” she said via a ministry media statement.
The US Department of State’s Trafficking in Persons Report ranked Cambodia in Tier 3, the lowest ranking and on par with Myanmar, Laos, Thailand and Vietnam.
Bun Eng added “Authorities must feel the urgency to act when Cambodia is placed in the lowest tier of global rankings for combating human trafficking. We must act decisively to address this issue and avoid complacency.”
Cambodia Can Tap into New Markets And Build On Current Ones
That said, the average visitor, investor and tourist will probably agree it’s a safe country to visit. There are ways that security could be enhanced especially in tourist areas and at night time which will further reassure visitors and encourage travel to Cambodia.
In terms of economic stability, political stability is and has been essential for attracting long-term investments, so the current stable political climate fosters confidence among investors regarding the safety of their investments.
You can scan the media on a weekly basis and see how new markets are being tapped from the Middle East to East Europe, Africa and elsewhere. Trade agreements, cross-border payment agreements and signing double tax agreements with relevant markets are all showing signs of progress.
Realestate.com.kh’s most recent foray into targeting Eastern Europe after it signed a strategic partnership with Bazanova Management in response to a newly identified target market is another example of local businesses pivoting and diversifying.
November-February is the tourist high season, and there is a shared and common benefit for all stakeholders and people and officials at all levels in the Kingdom to ensure visitors enjoy the best possible experience while visiting investors leave Cambodia with positive stories to tell within their respective circles at private and governmental levels. www.realestate.com.kh