Cambodia has some of the cheapest productive property in the world
that I've seen, far cheaper than in neighboring Thailand or even in
South America.
What they lack here is value-add capacity. Take rice, for example.
Rice is becoming a significant export in Cambodia, yet the country
lacks the capability to turn its raw paddy rice into refined, more
expensive grain.
Much of the rice is shipped off to Thailand at below-market rates
where it is milled, repackaged, and sold at a much higher price as
refined Thai jasmine or basmati.
Land costs and operating costs are both much lower in Cambodia… and
given the country's relative stability and sea access, it's much
easier to achieve economic scale here.
There is little reason why the entire value chain cannot take place
in-country… from growing to processing to transport.
Seafood and other agricultural commodities are in the same boat, so to speak.
Tourism is another key driver for future economic growth.
Cambodia receives a tiny fraction of the number of tourists that
Thailand, Malaysia, and even Vietnam receive, yet the country's
beautiful coastline, cultural treasures (like Angkor Wat), and
accommodating locals certainly rival regional competitors.
The issue with Cambodia is simply a promotional one… and that's
something that can be addressed with time, effort, and a
cleverly-deployed marketing budget.
There is already a steady rise in Chinese and Singaporean tourists
coming to the country, and Cambodia's reputation is slowly beginning
to spread.
Manufacturing is another compelling sector in Cambodia.
China still dominates Asian manufacturing, but the more China
transitions to a fully developed nation, the less competitively it can
manufacture cheap goods.
Cambodia is best positioned among its neighbors to take over from
China as it has several competitive advantages:
the labor market is young and fairly well educated. The port
facilities are reasonably developed.
And believe it or not, Cambodia's dollarized economy makes
international trade and cost structure predictable.
Now, to be involved in Cambodia, you definitely have to be here.
This isn't a place to have a factory that you drop in on every few
months– being here full-time is key.
If I were in-country full time, I would focus on a key trend: the
rising incomes of average Cambodians.
As the economy continues to grow, Cambodians across the board will
become wealthier.
And in the developing world, it's a simple progression.
When people are totally broke, they walk.
When they have a bit of money, they buy a bicycle.
Then a motorbike. And finally a car.
They start using more electricity, purchasing more expensive mobile
phone plans, eating out more often, buying sweets, upgrading their
beer selection, etc.
You won't find iPad sales skyrocketing here anytime soon, but simple
pleasures do extremely well in this sort of environment.
Last, I should mention that both foreigners and their capital are
treated well in Cambodia.
Taxes are low (0% to 10%), and the country lacks the political
instability that Thailand seems to undergo every few months.
Overall, for both foreign investors and entrepreneurs, Cambodia is a solid bet.
There are a lot of opportunities to make some serious money here, and
the start up costs are negligible.
More :
http://www.businessinsider.com/cambodia-almost-endless-opporunities-2011-10
Simon Black
Oct. 19, 2011
http://www.businessinsider.com/author/simon-black
