Editing Economy of Cambodia (section)

== Economic sectors ==

=== Garment industry ===
The garment industry represents the largest portion of Cambodia's manufacturing sector, accounting for 80% of the country's exports. In 2012, the exports grew to $4.61 billion up 8% over 2011. In the first half of 2013, the garment industry reported exports worth $1.56 billion.<ref name="investvine">{{cite web|url=http://investvine.com/cambodias-textile-industry-grew-32/|title=Cambodia's textile industry grew 32%|first=Arno|last=Maierbrugger|work=Inside Investor|date=11 July 2013|access-date=11 July 2013|archive-date=2 October 2013|archive-url=https://web.archive.org/web/20131002063558/http://investvine.com/cambodias-textile-industry-grew-32/|url-status=dead}}</ref> The sector employs 335,400 workers, of which 91% are female.

The sector operates largely on the final phase of garment production, that is turning yarns and fabrics into garments, as the country lacks a strong textile manufacturing base. In 2005, there were fears that the end of the [[Multi Fibre Arrangement]] would threaten Cambodia's garment industry; exposing it to stiff competition with China's strong manufacturing capabilities.<ref>[https://www.nytimes.com/2013/04/09/business/global/wary-of-events-in-china-foreign-investors-head-to-cambodia.html ''Wary of China, Companies Head to Cambodia''] April 8, 2013 New York Times</ref> On the contrary, Cambodia's garment industry at present continues to grow rapidly. This is can be attributed to the country's open economic policy which has drawn in large amounts of foreign investment into this sector of the economy.

Garment Factories by Ownership Nationality in 2010:<ref>{{cite web |url= http://www.gmac-cambodia.org/bulletin/2010.pdf |title= Annual Bulletin 2010 |author= Garment Manufacturers’ Association in Cambodia (GMAC) |page= 10 |date= March 17, 2010 |access-date= July 7, 2015 |url-status= dead |archive-url= https://web.archive.org/web/20160303224422/http://www.gmac-cambodia.org/bulletin/2010.pdf |archive-date= March 3, 2016 }}</ref>
{| class="wikitable sortable"
|-
! Nationality of Ownership !! Ownership by percentage !! Number of factories owned
|-
| Taiwan || 28% || 66
|-
| China || 19% || 44
|-
| Hong Kong || 17% || 39
|-
| South Korea || 13% || 31
|-
| Malaysia || 6% || 14
|-
| Cambodia || 5% || 13
|-
| Singapore || 4% || 10
|-
| USA || 4% || 9
|-
| Others || 4% || 10
|}
[[File:Cambodiahealth1.jpg|thumb|A garment factory worker in Cambodia undertaking health precautions]]

In 2010, 236 garment export-oriented factories were operating and registered with GMAC, the Garment Manufacturers Association in Cambodia, with 93% being foreign direct investment (FDI).

As seen in the table above, Cambodia's garment industry is characterized by a small percentage of local ownership. This is a reflection of the deficiency of skilled workers in the country as well as the limited leverage and autonomy Cambodian factories have in strategic decisions.<ref>{{cite journal|last=Lee|first=Joosung J.|title=An Outlook for Cambodia's Garment Industry in the Post-Safeguard Policy Era|journal=Asian Survey|date=May–June 2011|volume=51|issue=3|pages=562|doi=10.1525/as.2011.51.3.559}}<!--|access-date=9 February 2013--></ref> Another characteristic of the industry is the country's competitive advantage as the only country where garment factories are monitored and reported according to national and international standards.<ref>{{cite journal|last=Lee|first=Joosung J.|title=An Outlook for Cambodia's Garment Industry in the Post-Safeguard Policy Era|journal=Asian Survey|date=May–June 2011|volume=51|issue=3|pages=564|doi=10.1525/as.2011.51.3.559}}<!--|access-date=9 February 2013--></ref>

This has allowed Cambodia to secure its share of quotas for exports to the US through the US-Cambodia Trade Agreement on Textiles and Apparel (1999–2004), which linked market access to labor standards. However, the Cambodian garment industry remains vulnerable to global competition due to a lack of adequate infrastructure, labor unrest, the absence of a domestic textile industry, and almost complete dependence on imported textile material.<ref>{{cite journal|last=Lee|first=Joosung J.|title=An Outlook for Cambodia's Garment Industry in the Post-Safeguard Policy Era|journal=Asian Survey|date=May–June 2011|volume=51|issue=3|pages=566|doi=10.1525/as.2011.51.3.559}}<!--|access-date=9 February 2013--></ref>

GMAC is establishing a specialized training institute to train garment workers. The institute is in Phnom Penh Special Economic Zone and will be completed by late 2016.{{update inline|date=March 2022}} It aims to train 1,600 garment workers in the first three years and 240 university students each year as part of a separate program.<ref>{{cite news|title=Training institute to boost garment sector in Cambodia|url=http://banglaapparel.com/en/news/2015-09-06_17:24:56:0.098492001441538696.en.html|access-date=9 September 2015|newspaper=BanglaApparel.com|date=24 May 2015|author=Kaniz Fatima Kanta|archive-url=https://web.archive.org/web/20150930201310/http://banglaapparel.com/en/news/2015-09-06_17:24:56:0.098492001441538696.en.html|archive-date=30 September 2015|url-status=dead}}</ref>

=== Agriculture ===
{{Further|Agriculture in Cambodia}}

[[File:Cambodian farmers planting rice.jpg|thumb|300px|Cambodians planting rice, 2004.]]
Agriculture is the traditional mainstay of the Cambodian economy. Agriculture accounted for 90 percent of [[GDP]] in 1985 and employed approximately 80 percent of the work force. [[Rice]] is the principal commodity.

Major secondary crops include [[maize]], [[cassava]], [[sweet potato]]es, [[Bambara groundnut|groundnuts]], [[soybean]]s, [[sesame seed]]s, dry beans, and [[rubber]]. The principal commercial crop is rubber. In the 1980s it was an important primary commodity, second only to rice, and one of the country's few sources of foreign exchange.

=== Tourism ===
{{Further|Tourism in Cambodia}}
In the 1960s, Cambodia was a prominent tourist destination in the [[Southeast Asia]]n region. Due to protracted periods of civil war, insurgencies, and especially the genocidal regime of the Khmer Rouge (see [[Khmer Rouge Genocide]]), Cambodia's tourism industry was reduced to being virtually non-existent. Since the late 1990s, tourism is fast becoming Cambodia's second largest industry, just behind the garment manufacturing.<ref name="Chheang 284">{{cite journal|last=Chheang|first=Vannarith|title=The Political Economy of Tourism in Cambodia|pages=284}}</ref> In 2006, Cambodia's tourism sector generated a revenue of US$1.594 billion, which made up approximately 16% of the country's GDP.<ref name="Chheang 284"/>

[[File:Angkor Wat.jpg|thumb|300px|[[Angkor Wat]] in Siem Reap, Cambodia.]]
Cultural heritage tourism is especially popular in the country, with many foreign tourists visiting the ancient Hindu temple of [[Angkor Wat]] located in the [[Siem Reap]] province. Other popular tourist attractions include the [[Royal Palace, Phnom Penh]], as well as ecotourism spots such as [[Tonlé Sap]] Lake and the [[Mekong]] River.

The tourism industry in Cambodia has been perpetuated by the development of important transportation infrastructure; in particular Cambodia's two international airports in [[Phnom Penh]] and [[Siem Reap]] respectively. To the Cambodian economy, tourism has been a means for the accumulation of foreign currency earnings and employment for the Cambodian workforce, with about 250,000 jobs generated in 2006.<ref name="Chheang 284"/> Meanwhile, challenges to the industry include leakage of revenue to foreign markets due to a dependence on foreign goods as well as the prevalence of the [[Child sex tourism]] industry.<ref>{{cite journal|last=Chheang|first=Vannarith|title=The Political Economy of Tourism in Cambodia|pages=293}}</ref>

=== Gambling industry ===
{{excerpt|Gambling in Cambodia}}

[[File:Russian Blvd, P.P..JPG|thumb|300px|Russian Federation Boulevard in [[Phnom Penh]].]]

=== Construction ===
The increase in tourist arrivals has led to growing demand for hotels and other forms of accommodation surrounding tourist hotspots. Siem Reap in particular has seen a [[construction]] boom in recent years. The capital Phnom Penh has also witnessed a growth in the construction and real estate sectors. Recently, planned projects that have been on the pipeline for several years have been shelved temporarily due to a reduction in foreign investment. From 2009, the Cambodian government has allowed foreigners to own condominiums. This has helped in attracting real estate investors from [[Thailand]], [[Malaysia]], [[Singapore]] and other countries.

The construction sector attracted investment of $2.1 billion in 2012 which is a 72 per cent rise compared with 2011. Construction licenses issued stood at 1,694 projects in 2012, which was 20% lower than 2011 but they were higher in value.

=== Resources ===
{{Further|Natural resources of Cambodia|Mineral industry in Cambodia}}
[[Petroleum seep|Oil seeps]] were discovered in Cambodia as early as the 1950s by Russian and Chinese geologists. Development of the industry was delayed, however, by the [[Vietnam War|Vietnam]] and [[Cambodian Civil War]]s and the political uncertainty that followed. Further discoveries of oil and natural gas deposits offshore in the early 2000s led to renewed domestic and international interest in Cambodia's production possibilities. As of 2013, the US company [[Chevron Corporation|Chevron]], Japanese [[Japan Oil, Gas and Metals National Corporation|JOGMEC]] and other international companies maintained production sites both on shore and off. Chevron alone had invested over US$160 million and drilled 18 wells.<ref>{{Cite web|url=http://www.regionalgeography.org/cambodia2012/2013/02/10/oil-and-natural-gas-race/|archiveurl=https://web.archive.org/web/20140108065720/http://www.regionalgeography.org/cambodia2012/2013/02/10/oil-and-natural-gas-race/|url-status=dead|title="Oil and Natural Gas Race"|archivedate=January 8, 2014}}</ref>

Sok Khavan, acting director general of the Cambodian National Petroleum Authority, estimated that once the contracts are finalized and legal issues resolved, the Cambodian government will receive approximately 70% of the revenues, contributing to an economy in which the GDP is projected to increase five-fold by 2030.<ref name=UPI>{{cite news|title=Cambodia gears for offshore drilling|url=http://www.upi.com/Business_News/Energy-Resources/2012/09/27/Cambodia-gears-for-offshore-drilling/UPI-86021348765641/|access-date=8 January 2014|newspaper=UPI|date=27 September 2012}}</ref> In addition, there are 10,000 square miles offshore in the [[Gulf of Thailand]] that holds potential reserves of 12-14 trillion cubic feet of natural gas and an unspecified amount of oil.<ref name=UPI /> The rights to this territory are currently a subject of dispute between Cambodia and Thailand, further delaying any possible production developments. In early 2013 it was reported that the two countries were close to a deal that would allow joint production to begin.<ref>{{cite news|title=The struggle between Thailand and Cambodia over oil and gas resources|date=17 September 2010|agency=CLC Asia  |url=http://www.clc-asia.com/the-struggle-between-thailand-and-cambodia-over-oil-and-gas-resources-2/|access-date=29 December 2013}}</ref><ref>{{cite news|title=Cambodia Aims for Offshore Production Next Year|author=Jacob Gronholt-Pedersen |date=26 September 2012|agency=The Wall Street Journal  |url=https://www.wsj.com/news/articles/SB10000872396390443507204578020023711640726|access-date=29 December 2013}}</ref>

===Foreign aid===
[[File:Battambang Provinz 01.jpg|thumb|300px|[[Rice|Rice milling]] is very important to the Cambodian economy.]]
Cambodia's emerging [[democracy]] has received strong international support. Under the mandate of the [[United Nations Transitional Authority in Cambodia]] (UNTAC), $1.72 [[1000000000 (number)|billion]] (1.72 G$) was spent in an effort to bring basic security, stability and democratic rule to the country. Various news and media reports suggest that since 1993 the country has been the recipient of some US$10 billion in foreign aid.<ref>{{Cite web|url=http://www.saloimpera.com/#!Doing-business-in-Cambodia-Is-it-a-new-breed-of-Asian-Tiger/ck3kq/572968020cf205ef80cb4fe2|title=Salo-Impera: Strategic Planning, Development & Consulting for business|website=Salo-Impera: Strategic Planning, Development & Consulting for business|access-date=2016-06-16|archive-url=https://web.archive.org/web/20160714141628/http://www.saloimpera.com/#!Doing-business-in-Cambodia-Is-it-a-new-breed-of-Asian-Tiger/ck3kq/572968020cf205ef80cb4fe2|archive-date=2016-07-14|url-status=dead}}</ref><ref>{{Cite web|url=http://www.voacambodia.com/a/as-foreign-aid-increases-questions-about-conditions/1664821.html|title=As Foreign Aid Increases, Questions About Conditions|website=VOA|date=21 May 2013 |access-date=2016-06-16}}</ref>

With regards to economic assistance, official donors had pledged $880 million at the Ministerial Conference on the Rehabilitation of Cambodia (MCRRC) in [[Tokyo]] in June 1992. In addition to that figure, $119 million was pledged in September 1993 at the International Committee on the Reconstruction of Cambodia (ICORC) meeting in [[Paris]], and $643 million at the March 1994 ICORC meeting in Tokyo.

Cambodia experienced a shortfall in foreign aid in the year 2005 due to the government's failure to pass anti-corruption laws, opening up a single import/export window, increasing its spending on education, and complying with policies of good governance.<ref>{{cite journal|last=Weggel|first=Oskar|title=Cambodia in 2005: Year of Reassurance|journal=Asian Survey|date=January 2006|volume=46|issue=1|pages=151–161|jstor=10.1525/as.2006.46.1.155|doi=10.1525/as.2006.46.1.155}}</ref> In response, the government adopted the National Strategic Development Plan for 2006–10 (also known as the “Third Five-Year Plan”). The plan focused on three major areas:
* the speeding up of economic growth at an annual rate of 6-7%
* eradicating corruption
* developing public structures in favor of quality (i.e. by education, training, and healthcare) over quantity (i.e. rapid population growth)<ref>{{cite journal|last=Weggel|first=Oskar|title=Cambodia in 2005: Year of Reassurance|journal=Asian Survey|date=January 2006|volume=46|issue=1|pages=158|jstor=10.1525/as.2006.46.1.155|doi=10.1525/as.2006.46.1.155}}</ref>

=== Banking ===
{{Further|List of banks in Cambodia}}
There are no significant barriers to bank entry. At the end of 2013, there stood 35 commercial banks.<ref>Aaron Batten, Poullang Doung, Enerelt Enkhbold, Gemma Estrada, Jan Hansen, George Luarsabishvili, Md. Goland Mortaza, and Donghyun Park, 2015. [http://www.adb.org/sites/default/files/publication/173460/ewp-450.pdf The Financial Systems of Financially Less Developed Asian Economies: Key Features and Reform Priorities]. ADB Economics Working Paper Series No. 450</ref> Since 2011 new banks
with offshore funding have begun to enter the market.

=== Telecommunications ===
{{Further|Telecommunications in Cambodia}}

=== Energy ===
{{Further|Energy in Cambodia}}Cambodia has significant potential for developing renewable energy and could potentially run its energy system on 100% renewable sources.<ref>{{Cite journal |last1=Handayani |first1=Kamia |last2=Overland |first2=Indra |last3=Suryadi |first3=Beni |last4=Vakulchuk |first4=Roman |date=November 2023 |title=Integrating 100% renewable energy into electricity systems: A net-zero analysis for Cambodia, Laos, and Myanmar |journal=Energy Reports |language=en |volume=10 |pages=4849–4869 |doi=10.1016/j.egyr.2023.11.005|doi-access=free |bibcode=2023EnRep..10.4849H }}</ref> The country, however, remains one of the few countries in the ASEAN region that has not adopted renewable energy targets.<ref name=":1">Vakulchuk, R., Chan, H.Y., Kresnawan, M.R., Merdekawati, M., Overland, I., Sagbakken, H.F., Suryadi, B., Utama, N.A. and Yurnaidi, Z. 2020. Cambodia: Five Actions to Improve the Business Climate for Renewable Energy Investment. ASEAN Centre for Energy (ACE) Policy Brief Series, No. 5. https://www.researchgate.net/publication/341793835</ref> To attract more investment in renewable energy Cambodia could adopt targets, improve renewable energy governance, develop a regulatory framework, improve project bankability and facilitate market entry for international investors.<ref name=":1" /> Due to high vulnerability to climate change, it is recommended that Cambodia focuses on developing renewable energy away from fossil fuels as part of climate change mitigation measures.<ref>{{cite journal |last1=Overland |first1=Indra |last2=Sagbakken |first2=Haakon Fossum |last3=Chan |first3=Hoy-Yen |last4=Merdekawati |first4=Monika |last5=Suryadi |first5=Beni |last6=Utama |first6=Nuki Agya |last7=Vakulchuk |first7=Roman |title=The ASEAN climate and energy paradox |journal=Energy and Climate Change |date=December 2021 |volume=2 |page=100019 |doi=10.1016/j.egycc.2020.100019 |hdl=11250/2734506 |hdl-access=free }}</ref>

=== Transport ===
{{excerpt|Transport in Cambodia}}

=== Child labour ===
{{excerpt|Child labour in Cambodia}}

=== Trade - EBA Issues ===
The announcement from February 12, 2020, was to suspend "[[Everything but Arms|Everything But Arms]]" (EBA) trade preferences  between EU and Cambodia. The country has known to be the second largest beneficiary from EBA's program. The EU's preliminary conclusion sent to Cambodian government on November 12, 2019, because Cambodia failed to address serious human and labor rights concerns under Human Rights Watch.  Moreover, the issue behind ending the opposition party (CNRP) and dropping charges against the leader of CNRP violated the right to freedom of expression.<ref>{{Cite web|url=https://www.hrw.org/news/2020/02/13/cambodia-eu-partially-suspends-trade-preferences|title=Cambodia: EU Partially Suspends Trade Preferences|date=February 13, 2020|website=Human Rights Watch}}</ref>

=== Other industry ===
Cambodia is encouraging investment in EV assembly plants.<ref name=":Han">{{Cite book |last=Han |first=Enze |title=The Ripple Effect: China's Complex Presence in Southeast Asia |date=2024 |publisher=[[Oxford University Press]] |isbn=978-0-19-769659-0 |location=New York, NY}}</ref>{{Rp|page=59}} Cambodia's 2022 Long-Term Strategy for Carbon Neutrality to have 40% EV cars and busses and 70% electric motorbikes by 2050.<ref name=":Han" />{{Rp|page=59}} It has significantly reduced import duties on EVs.<ref name=":Han" />{{Rp|page=59}}