Cambodia9 Best Business Opportunities in Cambodia for Foreigners 2023

As an International business consultancy firm, we strongly believe that Cambodia presents the best business opportunities in the Southeast Asian region. With a favorable business environment and low taxes, Cambodia offers an attractive proposition for entrepreneurs seeking to expand their operations. Our analysis shows that the country’s strategic location in the heart of Southeast Asia, combined with its young and rapidly growing population with a strong work ethic, provides a large pool of potential employees. Cambodia’s government has implemented a range of reforms aimed at improving the ease of doing business, including streamlining the process for obtaining licenses and permits. Moreover, Cambodia’s thriving tourism industry, rich cultural heritage, and stunning natural attractions make it an ideal location for businesses in the hospitality and tourism sectors. Overall, we strongly recommend that businesses consider Cambodia as a prime location for establishing their operations and taking advantage of the best business opportunities in Cambodia.

Further,  Cambodia’s low labour cost and rapid economic growth make it an attractive place to set up a business in. The main advantages of setting up a private limited company in Cambodia include the option to incorporate a wholly foreign-owned company and the lack of a resident director requirement. With a minimum capital requirement of approximately USD 1000, it is relatively easy to set up a company in Cambodia with minimal cost. Hence, a Cambodia company registration may be profitable if you choose the right industry to expand your business. This article gives you a preview of some of the best business opportunities in Cambodia.

Agriculture

Accounting for more than 20% of the country’s Gross Domestic Product (GDP), the agriculture industry has traditionally been the largest contributor to the country’s national income. Although Cambodia’s reliance on the agriculture sector has greatly decreased over the years, it is still a major pillar of Cambodia’s economy. The demand of farming equipment and agricultural machinery such as modern tractors and harvesters have increased greatly in the past few years as farmers switched from traditional means of growing and cultivating crops to more efficient technological equipment. Hence, it may be profitable to register business in Cambodia with the purpose of providing facilities and new mechanism for farmers to increase their productivity.

Tourism

In 2019, Cambodia welcomed more than 6.6 million international tourists. Due to the country’s pristine beaches, religious monuments and popular cultural attractions such as the Angkor Wat, Cambodia is a popular tourist destination among Southeast Asians and Chinese living in the region. Unfortunately, the coronavirus pandemic in 2020 caused the tourism industry to shrink rapidly during the year, with tourist arrivals dropping by more than 80%. Currently, it is not recommendable to set up a tourism agency or any tourist-related business in Cambodia due to the low number of tourists in Cambodia caused by the strict restrictions and procedures with regards to travelling to Cambodia due to the pandemic. However, starting business in Cambodia’s tourism industry is likely to be popular again in the next few years once vaccination programmes are implemented across the world and the pandemic has subsided.

Real Estate

A popular investment choice for local investors, the real estate industry in Cambodia continues to boom even amidst the pandemic. Due to the country’s high GDP growth and stable political landscape, the country’s real estate has become an attractive investment option for investors who wish to invest in an emerging market. The rapid growth of foreign direct investment in the past decade has also fuelled the demand for high quality residential estates and office buildings. Hence, it would be profitable to set up a company that is involved in the construction or investment in residential and commercial properties.

Textile

Cambodia’ textile sector employs the greatest number of workers in Cambodia and accounts for most of the country’s exports. A majority of the raw materials in Cambodia’s textile factories are imported from overseas country while the final product is manufactured and sewed by Cambodian workers according to the designs stipulated by the multi-national corporations. The textile industry in Cambodia is mainly dominated by foreign firms that outsource their production process to Cambodia to take advantage of the low labour costs. This allows them to produce clothes and garments of a satisfactory quality at a low cost for consumers living in wealthy countries.

Food and beverage

It is relatively easy to set up a small eatery or restaurant in Cambodia and apply for the relevant licenses. Business owners can also consider setting up a company that produces or sells packaged food to local residents. The demand of packaged food has increased over the years, especially during the pandemic. Currently, most of the packaged food and drinks in Cambodia are imported. Hence, this suggests a potential business opportunity for local producers. 

IT and technology

The Information and Communications Technology (ICT) industry in Cambodia is still relatively small and internet penetration in Cambodia is around 50%. This can largely be attributed to the lack of IT infrastructure and the low coverage of broadband services. While most urban areas have reliable and stable internet connection, there is still much room for improvement for mobile phone coverage in rural areas. However, businesses that set up in the IT sector in Cambodia may face difficulty hiring skilled workers due to the lack of IT professionals in the country.

Healthcare

As Cambodians become wealthier and the life expectancy in Cambodia increases, the demand for better quality healthcare products services will increase at the same time. Non-communicable diseases such as Alzheimer’s disease and diabetes which are traditionally prevalent in wealthy nations are becoming more widespread in Cambodia. As such, there are many business opportunities in Cambodia such as the provision of training and expertise in healthcare technology, introduction of new health insurance schemes and supplying of pharmaceuticals and medical equipment. There is also potential for digitalisation in the healthcare industry in Cambodia.

Education services

With more than 40% of the population aged below 25, there is a high demand for education services in Cambodia, especially as more and more Cambodians recognize the importance of getting an education to increase their employability and earn higher wages in the future.  Although the percentage of students receiving a tertiary education has increased over the years, it still remains low compared to neighbouring countries. Hence, there is an opportunity for foreign education institutes to provide higher paper qualification to students in Cambodia. Currently, the quality and diversity of courses offered by Cambodia universities are fairly low due to the lack of teachers in the relevant expertise.

Transport and logistics

As a major exporter of textile, the logistics sector in Cambodia is very important as it ensures that goods and services are transported efficiently between producers and consumers. Presently, roads and expressways account for 90% of transport of passengers and freight shipping and it is regarded as the principal mode of transport in Cambodia. As such, the government plans to shift its focus to develop Cambodia’s network of railways, inland waterways, ports and airport facilities. There is a huge potential for railway transport in Cambodia because of the large amount of goods and raw materials delivered through land transport everyday. Hence, investing in railway infrastructure may be a good business opportunity for foreign business owners.

Manufacturing

Manufacturing is one of the best business opportunities in Cambodia due to a number of reasons. The country’s strategic location in Southeast Asia provides it with easy access to regional markets such as Thailand, Vietnam, and China. The Cambodian government has implemented policies aimed at encouraging foreign investment, including tax incentives and simplified processes for obtaining permits and licenses. The country’s labor market is also highly competitive with low wages, making it an attractive destination for manufacturers. In addition, the country’s young and growing population is characterized by a strong work ethic, which means that businesses can draw from a large pool of potential employees. The country’s infrastructure has also improved significantly in recent years, with the expansion of the country’s road network, and upgrades to its ports and airports. Finally, Cambodia’s economy is growing, and its middle class is expanding, providing a growing market for manufactured goods. Overall, manufacturing is a highly attractive business opportunity in Cambodia, with ideal conditions for businesses seeking to expand their operations in Southeast Asia.

Creative Industries

The creative industry is burgeoning as one of the best business opportunities in Cambodia due to the country’s rich cultural heritage and growing market for creative products and services. Cambodia has a strong tradition of arts and crafts, including silk weaving, wood carving, and pottery, that are highly valued both locally and internationally. Additionally, the country has a vibrant contemporary art scene. The Cambodian government has recognized the potential of the creative industry and has put in place measures to support its growth, such as investment in infrastructure, training programs for artists, and financial incentives for creative businesses. Furthermore, Cambodia’s young and growing population is increasingly interested in creative products and services, providing a growing market for businesses in the industry.

Environmental Services

The environmental services sector is emerging as a highly lucrative business opportunity in Cambodia, given the country’s environmental challenges and the increasing focus on sustainability. Cambodia is facing several environmental issues, including deforestation, pollution, and land degradation, which require effective solutions. The Cambodian government has recognized the importance of environmental protection and has implemented policies to promote sustainable development, such as the creation of protected areas and the encouragement of eco-tourism. Private businesses have also begun responding to the growing demand for environmental services, offering solutions such as waste management, renewable energy, and conservation services. Additionally, the international community is increasingly interested in investing in sustainable development in Cambodia, which presents opportunities for businesses in the environmental sector to access funding and form partnerships.

Financial Services

The financial services sector is an increasingly promising business opportunity in Cambodia due to the country’s expanding economy and growing demand for financial products and services. Cambodia’s economy has grown at an average of 7% over the last ten years, and the middle class is expanding, creating a larger market for financial services. To encourage the growth of the financial sector, the Cambodian government has established regulatory frameworks, provided incentives for foreign investment, and improved financial infrastructure. Several international and local banks are also operating in the country, contributing to the growth of Cambodia’s banking sector.

Mining and Natural Resources

The mining and natural resources sector is an attractive business opportunity in Cambodia due to the country’s vast reserves of minerals and the growing global demand for natural resources. Cambodia boasts significant deposits of minerals such as gold, iron ore, bauxite, and gemstones, as well as potential reserves of oil and gas. The Cambodian government has implemented policies to attract foreign investment in the sector, such as offering tax incentives and streamlining regulatory frameworks. The country’s strategic location, with access to major shipping lanes and neighboring countries, presents opportunities for businesses to export minerals and natural resources.

Renewable Energy

Renewable energy represents one of the most lucrative and best business opportunities in Cambodia, given the country’s vast sources of renewable energy and the rising demand for sustainable energy solutions. Cambodia has a significant potential for renewable energy production, including solar, wind, hydropower, and biomass. The Cambodian government has established ambitious targets to increase renewable energy capacity and reduce reliance on fossil fuels. To encourage investment in the sector, the government has implemented policies offering incentives for renewable energy development, such as tax exemptions, feed-in tariffs, and streamlined permitting processes. Furthermore, Cambodia’s fast-growing economy and increasing energy demand present attractive market opportunities for renewable energy companies. Increasing awareness and concern for climate change and environmental sustainability further boost the demand for clean energy solutions.

Conclusion

Generally, foreigners tend to set up a business in Cambodia due to the country’s long term economic stability, strong economic growth, stable political landscape and the wide array of investment opportunities in different sectors. There is also no need to employ a nominee resident director to manage your business in Cambodia as there is no nationality or residency requirement for a director in a Cambodia limited liability company. Hence, business owners can have full control of their businesses.

Tetra Consultants provides you with a fast and easy way to register company in Cambodia through our service package which includes company registration with the Cambodia Ministry of Commerce (MEC); provision of local company secretary and a registered address; opening of corporate bank account; tax registration; Cambodia business visa applications; and other tax and accounting services. Tetra Consultants will also recommend the type of business entity suitable for your company, based on your long-term goals and business model.