Cambodian Stock Exchange sees challenges, opportunities

Monday, May 7, 2012
By Pauline Chiou
Special to The China Post

I visited the Cambodian Stock Exchange (CS--) last September in the heart of Phnom Penh. It had officially “opened” a few months prior but no companies were listed yet. The trading room was filled with new desks and computer monitors, waiting for someone to power them on. Fast-forward seven months and the stock exchange is now starting to breathe signs of life— there is now one company trading on the exchange. On April 18, the Cambodian Stock Exchange started trading with the initial public offering (IPO) of the state utility company, “Phnom Penh Water Supply Authority.”

As a frontier market, Cambodia is still a work in progress.

The government is trying to woo global investors by throwing open its doors and virtually saying, “We'll make it easy for you.” There are no capital controls. No requirements for joint ventures. International companies can own 100 percent of their local business in Cambodia. The only major restriction is on foreign ownership of land. With a young labor force that commands cheaper wages than China, Cambodia has been looking attractive to foreign companies. Despite these incentives, there are many challenges for the new stock exchange:

China's Hong Kong is booming [- A lesson for Cambodia to learn from]

KI-Media would like to thank Dr Lao Mong Hay for pointing out this Hong Kong's success story. Dr Lao Mong hay hopes that this story "could inspire further our Cambodian visionary leaders, if we have any such leader. One economist pointed at the contributing factors to this success: 'One of the strong advantages of Hong Kong has always been the institution. So the likes of rule of law, the independent judiciary, the strong governance system, the accounting system.'"

Friday, June 29, 2007
By Kate Woodsome
Marketplace
American Public Media (USA)

Hong Kong skyline at night (Getty Images)

When Britain ceded control of its former colony in 1997, there were predictions that communist China would kill the golden goose. But this anniversary finds Hong Kong doing just fine, thank you. Kate Woodsome reports.

Lisa Napoli: Happy anniversary to Hong Kong — on Sunday, the territory holds a big party to celebrate 10 years of Chinese rule.

Traits from the British years still dominate: a capitalist economy, free press, an independent judicial system... Some expected that to be bad for business in Hong Kong. But Kate Woodsome says the formula has surprised even the biggest skeptics.

Kate Woodsome: Two years before Britain gave up its last major colony, Fortune magazine ran a story titled "The Death of Hong Kong." It predicted China's communist system would choke Hong Kong's capitalist economy.

Christopher Hammerbeck: That to me was totally bizarre, frankly.

That's Christopher Hammerbeck of the British Chamber of Commerce here. He says the obituary was a bit premature.

Hammerbeck: The one thing that is quite sure about history is that trade relationships far outlast uncomfortable diplomatic relationships.

After the 1997 Asian financial crisis, Hong Kong's economy did suffer badly. But it has rebounded, and is experiencing its fastest growth since the late 1980s.

Hong Kong largely has China to thank. Mainland Chinese make up more than half of Hong Kong's 25 million tourists. Loads of tourists line up every day for the bus to Ocean Park. They go for the pandas and gondolas.

Shishi Wong came from Shanghai to see how Hong Kong merged its two identities.

Shishi Wong: I just felt it's such an efficient place that everybody just knows exactly what to do. But at the same time, you can see like how the Chinese culture is here. It's amazing.

Investors feel the same. Last year, so many mainland companies listed on the Hong Kong exchange that the territory rivals London as the world's biggest IPOs market. Its GDP reached $189 billion last year, and is expected to grow about six percent this year.

Tai Hui, an economist for Standard Chartered bank, says investors stay in Hong Kong because it's the closest you can get to China and still enjoy international business standards.

Tai Hui: One of the strong advantages of Hong Kong has always been the institution. So the likes of rule of law, the independent judiciary, the strong governance system, the accounting system.

But Hong Kong is looking over its shoulder. Chinese cities like Shanghai are cleaning up their markets, and that's attracting investors.

In Hong Kong, I'm Kate Woodsome for Marketplace.