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Phnom Penh is the capital of Cambodia, without interruption, since 1862. The functions of political and economic capital enable the city to have a GDP of approximately $1.4 billion US dollars (2003) which is 28% of the national GDP. That is to approximately $1.140 per capita, three times more than the average of the country.

Very competitive investment incentives

The promulgation of the new investment law means Cambodia now offers the best business incentive package in Southeast Asia; making the Kingdom’s outward-looking economy a very attractive place to invest. The following are the highlights of the new law :

  • 9% corporate/income tax
  • Tax holidays of up to 8 years
  • 5 year loss carried forward
  • Full import duty exemption
  • No withholding tax on dividends
  • Free repatriation of profits
  • No nationalization and price controls
  • No discrimination between foreign and local investors
  • Land leases of up to 70 years

Market size and access

The function of the capital and the integration of Cambodia in the ASEAN and WTO lead an important activity of business tourism. With more than 50 % of hotel rooms, 30 % of guest house rooms and 60 % of the travel agencies in the country, Phnom Penh has the most important tourist activity of the country, ahead of Siem Reap but in a different capacity.

As a Least-Developed Country (LDC), Cambodia has preferential access to some of the world’s richest markets for a number of products such as garments.

An open economy

Cambodia has one of the most open economies in Asia. The index of Economic Freedom, compiled by the Heritage Foundation in the United States, ranked Cambodia 35th among 170 countries in 2003. Just ahead of Thailand (40th) and well ahead of several of its neighbors (Malaysia 72nd, Indonesia 99th, Vietnam 135th and Lao People’s Democratic Republic 153rd). Among the world’s Least-Developed Countries (LDC) covered by the index, Cambodia also ranks at the very top in market-friendliness.

Abundant young & low cost labor force

Its low-wage ($50 per month), trainable, and motivated work force is an asset in today’s increasingly competitive world economy.

Strategic location in greater Mekong subregion

It is located between Bangkok and Ho Chi Minh City, at the center of the “Second East-West Corridor”.

Special promotions zone

Industrial zones are to be developed in Phnom Penh, which will include export-processing zones and free-trade zones.

See also Phnom Penh Special Economic Zone

If you wish to invest in Phnom Penh, please visit Planning and Investment Division (Investment Office) of Phnom Penh Capital Hall.