Cambodia: Good returns for investors

• Jan 27, 2017

Cambodia’s average return on equity (ROE) has improved this year and insiders predict that the country will be able to attract more foreign direct investment due to investors’ perceptions that the kingdom could offer the best investment returns in 2017 for the Asean region. 

According to a survey done at the recent Asian Financial Forum in Hong Kong, which brought together influential members of the global financial and business community, Cambodia received a seven percent ROE rating in 2017 – up two percentage points compared with last year. This puts it on par with Malaysia and Myanmar. 

David Van, Cambodia managing director for Bower Group Asia, said that investors’ perceptions played a big role the Asian Financial Forum survey. 

“The issue of perception that financial institutions have on Asean markets is important. Normally investors look at different sectors most likely to generate best returns for them in different countries with different legal and institutional frameworks,” said Mr. Van.

Mr. Van said how a country branded itself was also important in the way foreign investors perceived investment opportunities. 

“The facts speak for themselves from the [results of] prompt survey done on the spot with [representatives of] institutional and private equity funds attending the 10th AFF,” he added. 

In Channy, president and group CEO of Acleda Bank, said improvements in the country’s infrastructure, labor and energy sectors were also contributory factors for the improvement in Cambodia’s ROE rating at the AFF. 

“When infrastructure, labor and energy costs decline that will ultimately make the average return on equity better for investors,” said Mr. Channy.

He said the improvement of the Sihanoukville Autonomous Port and plans to build a second airport in Phnom Penh also improved investors’ perceptions of doing business in Cambodia. 

According to the AFF press release, 77 percent of the forum’s attendees expected China’s One Belt and Road Initiative to yield substantial economic benefits to most, if not all, Asean countries. 

Analysts predict that Cambodia will benefit from opportunities in China’s One Belt and Road Initiative due to its strategic geographic location – linking China with Asean.

Source: http://www.khmertimeskh.com/news/34804/good-returns-for-investors/