The right way to start investing is to research first which industries you can properly profit from. Since Cambodia has an emerging market that is accessible and a projected GDP growth at 4% in 2021 despite the pandemic, there are numerous industries you can start investing in. To make it easier for you, check the complete list of industries to invest in Cambodia below:
Agriculture is one of the most integral industries providing a thriving market and stable economy in Cambodia. Its importance has been especially highlighted due to the pandemic since it helped support the economy when other industries declined.
Currently, Agriculture is one of the best industries you need to invest in as agricultural exports continue to increase in value. According to a report released by news site Khmer Times in May this year, Cambodia exceeded $2.09 billion in only the first quarter. Additionally, Asian Development Bank (ADB) released a report that the industry is expected to grow by 1.3% in 2021 and 1.2% 2022.
This means that if you allocate your funds correctly and choose the right products or companies in this industry, your money is set to grow.
The manufacturing industry in Cambodia is one of the biggest contributors to economic growth. This is largely due to the focus on producing footwear, garment, and textile exports, making it a great industry to invest in. Additionally, while reports indicate that garment exports dropped by 6.43% in the first quarter, it still reported a profit of $2.4 billion for 2021’s Q1 alone.
While the manufacturing industry in Cambodia continues to be reliant on exporting garments, other sectors like footwear and headwear are also making their moves to contribute to exports.
According to the economic update report made by World Bank Group released this June 2021, goods exports grew to 12.2% in the first four months. This further proves that there are a lot of investment opportunities in the manufacturing industry that will help build your portfolio. Make sure to check the market constantly so you can make the right money moves!
3. Real estate
One of the markets that will always be in demand is real estate. This stayed true despite the economic crisis brought by the pandemic where demand for housing slowed down. Particularly in Q2 of 2020, the average price of high-end apartments in Phnom Penh declined by 6.55% per square metre. This is due to the height of the pandemic since constructions were halted.
CBRE Cambodia’s Managing Director Ann Sothida indicated in an interview that the real estate industry’s situation will improve by the first or second quarter of 2021. James Hodge, Managing Director of the same company, indicated that deals struck regarding construction and real estate will move forward. Both their statements rang true since construction continued and demand is increasing in 2021, especially since other sectors are growing.
Furthermore, the number of condominium units existing in Phnom Penh alone is at 21,935 according to a report released by global real estate consultant Knight Frank. By 2023, the number of units will increase to 53,512, increasing the supply as demand continues to track higher.
An analysis report released by real estate company R&F City saw that the average rental yield in Phnom Penh is 8%, the highest compared to other Southeast Asian cities. Since it has a GDP growth rate of 7.1%, an average apartment price at $2,300 and permanent residency, it speaks to a great investment option.
Based on recent market analysis and predicted growth of real estate demand, it looks to be a great industry to start investing in.
One of the biggest contributors in the economic growth of Cambodia is the construction industry. While there was a decline in all sectors due to the pandemic, with construction at 6.7% decline in 2020, the industry is set to expand in 2021 by 9.1%.
According to the analysis report “Construction in Cambodia – Key Trends and Opportunities”, the growth range of investments will increase to 8.2% to 9.2% from 2022 to 2025. This means if you invest in Cambodia’s construction industry, your money will grow as the economy bounces back from last year’s decline.
Among the sectors affected by the global pandemic crisis in Cambodia is the tourism industry due to travel restrictions and more. While it can be seen as a vulnerable risk to the country’s economy, as things ease back to normal, domestic and global tourism is picking up. It is expected for the industry to thrive again with the latest developments in vaccinations so make sure to check the market to know where you can properly invest your money.
Investment opportunities in Cambodia
One of the fastest emerging markets is Cambodia with its GDP growth at 7.1% as per 2019. The GDP growth rate has remained consistent in its improvement over the years and Cambodia avoided high-risk decline that occurred in other countries across sectors. While it is unavoidable for demand in agriculture and manufacturing to slow down, experts predict that the sectors will pick up soon. Additionally, the turnaround of profits by the sectors like agriculture in only the first quarter of 2021 shows the economy is on its way to thriving again.
This quick development and increasing economic strength is a great opportunity for you to start investing in its sectors, so your money grows along with the economy. Start investing now!