Investment to Cambodia from Vietnam increases

[VIETNAM NET]

Vietnamese investment in Cambodia is on the increase as the two countries have recently signed nine Memorandums of Understanding for investment projects.

They were signed during the conference for the Cambodia-Vietnam investment promotion at the Peace Palace. The projects are worth about US$900 million.

The largest MoU was signed by Ith Praing, Secretary of State of for the Ministry of Industry Mines and Energy and Nguyen Thanh Bien, Deputy Minister of Vietnam’s Ministry of Industry and Trade. The deal that’s concerned with a hydro power project on the Lower Sesan II is worth about US$806 million.

Aside from the hydro power project, other projects include an iron ore project exploration in Ratanakkiri worth US$30 million, a US$20 million MoU agreement for a cassava plantation by Cam-Viet Rural Development Ltd, and a US$75 million investment project by Star Premier International Ltd. for a sugar cane project.

As well, an agreement of investment for a rubber plantation project by Hoang Anh Oyadav Co., Ltd and an agreement by Indochina Green JSC Co., Ltd. for a carbon credit project were also signed at the conference.

Minister of Commerce Cham Prasidh said in his speech that foreign trade statistics in 2010 have shown that exports from Cambodia to Vietnam amounted to US$276 million while imports from Vietnam to Cambodia amounted to US$1,552 million.

“Our trade deficit is growing due to consumer goods with reasonable prices and quality from Vietnam started to be popular in the Cambodian market compared to products from other neighboring countries,” said Cham Prasidh.

Speaking at the conference, tycoon Kith Meng, president of the Cambodia Chamber of Commerce, said that last year, two-way trade between the two countries increased by 37 percent to more than US$1.8 billion. He added that in the first quarter of this year, trade was over US$600 million and it expected to increase to US$2.5 billion for 2011.

According to Vietnamese data from 2009 to April 2011, Vietnam invested in 87 projects in Cambodia amounting to over US$2 billion, Commerce Minister Prasidh said, adding that he expects the figure will increase in 2011.

According to Doan Nguyen Duc, Chair-man of the Hoang Anh Gia Lai Group, a diversified group with interests in real estate, hydropower, rubber, and mining, Cambodia has a lot of business potential for Vietnamese investors to consider.

He added there are some comparative advantages such as having many international trade borders, a good relationship between the two governments, good mechanisms to encourage businesses, and low labor cost sare the elements that Vietnam investors would consider.

“The comparative advantages have encouraged Hoang Ang Gia Lai to invest more in Cambodia,” said Doan Nguyen Duc.

Speaking at the conference, Vietnamese Prime Minister Nguyen Tan Dung said that he would like to encourage more investors to consider business opportunities in Cambodia. Furthermore, he also wants to see the existing Vietnamese investors in Cambodia expand their capital investment to build better economic cooperation.