Selected Comments Samdech Techo Hun Sen at the Opening Session of the 9th Conference on Investments and Trade in 2017 [Unofficial Translation]

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Cambodia Forwards, No Backtracking

I would take this opportune moment to express my thanks to the speech of Mr. Bretton G. Sciaroni, which illustrates my role throughout the development of the Kingdom of Cambodia. I doubt how many of our foreign friends here would have similar understanding as Mr. Bretton S. Sciaroni. He has been one of the live witnesses of our difficulties in the past 23 years. Some have said that Cambodia is backtracking. They do not accept that Cambodia is moving forwards. I do not understand to where it backtracks I thank Mr. Bretton G. Sciaroni for raising the matter and I hope our foreign friends would try to understand these issues […]

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Today, I am delighted to be here with you all and I would like to warmly welcome domestic and foreign investors and businesspeople to this important event. This event is indeed a new pride for Cambodia as it is joined by many leading investors and businesspeople from across the globe. I believe there will be active discussions in order for us to come up with realistic and sound basis for decision making and the results will be used as inputs for the World Economic Forum on ASEAN which is hosted by Cambodia in May this year. I would like thank and express my high appreciation to International Business Chamber of Cambodia and related ministries-institutions for initiating and organizing this important Cambodia’s International Business Summit 2017.

Taking this opportunity, I would like to highlight some key milestones of Cambodia’s development progress to give you all a glimpse of golden opportunities on this land of wonder. Overall, Cambodia has gone through profound political, security and socio-economic transformations over the last few decades. Cambodia has become an island of peace and a famous tourism destination in Southeast Asia which received more than 5 million regional and international tourists in 2016, which represented a 5% growth. In terms of economic transformation, Cambodia has graduated from the status of low income country to lower middle income country and is one of the growth champions, achieving average annual growth of 7.7% over the last two decades. Along with this, Cambodia has intensified effort to build and develop both soft and hard infrastructure by expanding road network, railways, waterways, air routes, economic corridors, transportation and logistics system, electricity and distribution network, clean water network, telecommunication, financial services, education system, healthcare service across the country.

Obviously, based on this, even though the world is facing multiple economic, social and geopolitical challenges that include uncertainty of interest rate of the Federal Reserve, Brexit and future of the European Union, the risk of Chinese economic slowdown, the slower growth of emerging economies and rising geopolitical tensions, Cambodia is still expected to maintain the economic growth of around 7% per annum till 2018, which reflects diversification progress into light manufacturing and  integration into the regional and global production chains. Moreover, I have noticed that more and more Cambodians are now aware of the socio-economic structural changes and prepare themselves by strengthening and expanding their capacity to fully capitalize on these changes. In addition, the main duty of the Royal Government is to ensure sustainability and harmony of socio-economic development within this changing context to propel the country to new milestones, i.e. becoming a higher middle income country by 2030 and a high income country by 2050.

In this regard, I would like to encourage international investors and businesspeople to assess the possibility of investment in Cambodia by considering factors beyond Cambodia, namely the ASEAN context and Cambodia’s existing bilateral relations. In fact, Cambodia has a clear stance on the promotion and establishment of bilateral and multilateral relation and cooperation with many countries, and those bilateral partner countries have always provided favourable conditions for the development of Cambodian product market as well as the prosperity of Cambodia socio-economic development.

Beside, in the regional framework, ASEAN still continues to have a robust growth, which is considered as the safe region and contributed enormously to the global economic growth. As you have realized, since the mid-1960s until now, Southeast Asia has gone through many complicated stages from region divided into two blocs in which some countries, especially Cambodia, were destroyed by wars due to cold war ideology. After that, Southeast Asia has become a united community under one vision- ASEAN community, which is characterized by high economic growth, connectivity and deep structural changes. In fact, after the global economic and financial crisis in 1997, ASEAN had a very low GDP per capita. However, from 2007 to 2014, ASEAN’s national income has doubled to USD 2.5 trillion, while the GDP per capita has grown by almost 80%, reaching more than USD 4,000. With strong endeavours to deepen the integration and promotion of connectivity in all sectors, ASEAN has become a more influential regional community, with gradually widening markets both in the region and the globe, meaning it has become 3rd largest economy in Asia, and 7th largest in the world, and one of the most important markets among advanced integrated markets in the world.

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Solidarity, No Big Brother – ASEAN Values

… In one of our dinners at the World Economic Forum in Davos-Klosters, Switzerland, if I am not mistaken, a rector of a university in Europe posed us – Prime Minister of Vietnam and me, whether there are any members leaving ASEAN. I replied that he should change his answer to asking which countries, after BREXIT, would leave EU. In ASEAN, we do not have a big brother country and we are in solidarity. The fact that asking about which country to leave EU is a real thing. Take for instance in France, if Le Pen’s daughter wins the presidential election, the possibility of France leaving EU could be real. No country member is leaving ASEAN. I can affirm. ASEAN does not have power to force any member to leave and this might be the difference between ASEAN and EU.

The EU is facing a shakeup because of BREXIT, the Greeks thinking of leaving the Euro zone, and the immigration consequences. I had a talk with Prime Minister of Sweden and I raised this immigration topic because of color revolutions in the Middle East with him. HE George Edgar is a British and he represents the EU here. Once Britain is out of the EU, he could no longer represent it. He formerly worked as the UK Ambassador to the Kingdom of Cambodia, and now the EU Ambassador. However, when BREXIT is in implementation, he may as well end his term already.

The fact that I brought this matter up is because I wish to illustrate the ASEAN values – which are solidarity and our fraternity. We do not have any particular country acting as a big brother. We are not like in Europe. I have said so because I think we need to defend the ASEAN values […]

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Along with the establishment of ASEAN Economic Community as well as the expectation of Regional Comprehensive Economic Partnership in the near future, Cambodia has been doing its utmost to connect to “ASIA factory” which is a dynamic market with great potentials through investment in the expansion of production base, the establishment and​ improvement of transportation network and logistics, development of tourism infrastructure, promotion of trade facilitation, development of financial system, and regulatory and institutional reforms.

To support this vision, the Royal Government of Cambodia has launched and has been actively implementing “Cambodia Industrial Development Policy 2015 – 2025”, which is the new growth strategy or roadmap for increasing value added to the production base which is integrated with regional and global value chains. In fact, attracting foreign direct investment is the key factor of this policy that has focused on the cluster of priority sectors: (1) new industries that can penetrate into the new markets which have high value added and is innovative and highly competitive; (2) small and medium enterprises that produce pharmaceutical products and medical equipment, construction materials, packaging materials for exportation, furniture and industry equipment, etc. (3) Agro-industrial products for export and domestic markets, (4) industries that support agriculture, tourism and textiles as well as industries that form part of the regional and global production chains for both forward linkage and backward linkage industries(5) industries serving regional production chain that are of strategic importance such as information technology and telecommunication, energy, heavy industry, cultural/historical/traditional crafts and green technology.

Excellencies, Ladies and Gentlemen!

For today’s event, we will focus our discussion on five key sectors that include (1) education, (2) industry, (3) technology, outsourcing and digital technology, (4) agriculture, and (5) ​hospitality, food and drink sector. There is also discussion on environmental governance, regulatory and taxation regime for investment and business in Cambodia. Sectors that are chosen today will contribute to the implementation of Industrial Development Policy 2015 – 2025 that Cambodia has introduced. In this regard, I would like to encourage the discussion in each sector, participated by ministers and experts should come up with clear and in-depth analysis of situation, policy, and opportunities for investment in each sector.

With this effort, I would like to highlight that within the framework of industrial development policy, the Royal Government of Cambodia will continue its effort to achieve four key points: (1) lowering electricity cost for industrial region while expanding electricity supply coverage with better reliability,

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No Service Charge by Wing for Riel 100,000 Transfer of Electric Cost Payment

… This morning when I arrived, Oknha Kith Meng told me that any transfer of people’s pay of electric cost of Riel 100,000 and below (using Wing agent), there will not be any service charges. This is a good thing for up to millions of Cambodians. They can save some money. I am grateful to the decision which contributes to lowering the price of electricity for not only industrial purpose but also household consumption.

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(2) preparing and implementing master plan for the development of transportation system and multimodal logistics (3) strengthening labour market and skill training (4) developing and transforming Sihanoukville province into a multi-purpose SEZ. At the same time, the Royal Government of Cambodia will do its best to maintain peace, security, political and long term macro-economic stability as well as good cooperation with other countries in the region and the entire globe in combination with progress and achievements to date, ambitious but realistic vision, right policies, clear strategies and action plans and more importantly the will to achieve. Cambodia is actively taking part in ASEAN’s regional effort to transform this region into a main catalyst or rising star for promoting regional and global economic growth.

On this basis, I would like to invite you all to be our partners to shape the better future of Cambodia. I would also like to take this opportunity to reiterate that Cambodia still welcomes and encourages all foreign investment projects to come here. The Royal Government will continue to strengthen economic cooperation, promote openness and enhance investment environment to garner investors’ confidence.

On behalf of the Royal Government, I would like to reassure investors and businesspeople that we will continue to maintain a favourable and pro-investment environment especially macro-economic stability, attractive incentive framework as well as regulatory and institutional framework, peace and political stability in Cambodia.

Finally, I wish you all happiness, prosperity and success in all your endeavors./.