Although Cambodia has a strong ambition to become an upper middle-income nation by 2030 and a high income by 2050, it faces various challenges in achieving these goals. This study investigates Cambodia\u2019s progress and potential in this regard by analysing its position and trajectory relative to Greenfield Foreign Direct Investment (FDI) inflows and outflows \u2013 where foreign firms establish new operations in Cambodia and Cambodian investors set up businesses abroad. This study also provides preliminary insights on Cambodia’s integration into Global and Regional Value Chains (GVCs), always using FDI as a proxy, considering sectoral, functional, and geographical trends and comparing them with those of its neighbouring countries \u2013 Lao People\u2019s Democratic Republic and Vietnam \u2013 over the 20 years between 2003 and 2022.<\/p>\n
The research employs a desk review, SWOT analysis, and descriptive statistics by using academic literature, policy documents, stakeholder policy dialogues, and the fDiMarkets database by Financial Times. The analysis shows that FDI has been instrumental in reshaping Cambodia\u2019s economic structure, significantly contributing to economic development and job creation. Key sectors attracting FDI include real estate, financial services, and alternative\/renewable energy, while textiles, real estate, and consumer products are notable for generating employment opportunities. However, most FDI projects are concentrated in the capital and coastal areas, and have focused on low-tech manufacturing, which offer limited opportunities for spillovers and industrial upgrading. Cambodia\u2019s outward FDI began in 2008, mainly targeting ASEAN countries.<\/p>\n
This paper highlights that Cambodia has developed a robust policy framework to attract and re-orient inward FDI, including a provision of various incentives for Qualified Investment Projects. Recent FDI inflow trends indicate growing interest in sectors such as alternative and renewable energy, rubber, automotive OEM, leisure and entertainment, food, tobacco, beverages, and paper, printing, and packaging industries. These sectors could be pivotal for Cambodia\u2019s future growth.<\/p>\n
While Cambodia is making progress in addressing business challenges, there is a critical need to accelerate efforts to fully leverage FDI and support local firms\u2019 development. This paper offers policy recommendations to address these challenges and maximise the potential benefits of FDI and regional GVCs, supporting Cambodia\u2019s economic transition towards its income targets.<\/p>\n
\u00a0Keywords:<\/strong><\/b>\u00a0Foreign Direct Investment, Global Value Chains, Inward FDI, Outward FDI, Cambodia<\/p>\n","protected":false},"excerpt":{"rendered":" Although Cambodia has a strong ambition to become an upper middle-income nation by 2030 and a high income by 2050, it faces various challenges in achieving these goals. This study investigates Cambodia\u2019s progress and potential in this regard by analysing its position and trajectory relative to Greenfield Foreign Direct Investment (FDI) inflows and outflows \u2013 where foreign firms establish new operations in Cambodia and Cambodian investors set up businesses abroad. This study also provides preliminary insights on Cambodia’s integration into […]<\/p>\n","protected":false},"featured_media":0,"template":"","meta":{"_acf_changed":false,"_kad_blocks_custom_css":"","_kad_blocks_head_custom_js":"","_kad_blocks_body_custom_js":"","_kad_blocks_footer_custom_js":"","site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"set","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[5],"tags":[],"class_list":["post-33612","publications","type-publications","status-publish","hentry","category-uncategorized"],"acf":[],"yoast_head":"\n