Spotlight on Phnom Penh: Asean summit helps Cambodia woo investors, including some wary Thai businesses

26/03/2012
Anucha Charoenpo
Bangkok Post

"It is necessary for us to find cheaper labour markets or our businesses won't survive. Cambodia is our target"

The Cambodian government hopes to use its status as the Asean chair this year to attract investors from Southeast Asia and beyond, but despite the red-carpet welcome from the government, some scepticism remains among Thai investors.

The 20th Asean Summit will be held in Phnom Penh from April 3-4, and authorities hope to use it as a magnet to encourage foreign investors to study the possibilities Cambodia offers.

"Cambodia is now a gateway in Asean. We welcome all foreign investors. Our government policies are business-friendly for investors. We respect the basic human rights of the people and we are not divided by colours," Cambodian government spokesman Phay Siphan said in a reference to political tensions in Thailand.

One of the government's big concerns, he noted, was the protection from exploitation of Cambodian workers who have travelled abroad in search of better-paying jobs.

Countries such as Thailand have a large number of migrant workers of Cambodian descent, and Prime Minister Hun Sen has ordered the government to ensure that both domestic labourers and those who have left Cambodia to find jobs in Thailand are well taken care of, said the spokesman.

He said the prime minister wanted the government to take serious action against labour trafficking and come up with measures to prevent Cambodian people from being cheated when they go to work in other countries.

The Cambodian premier, Phay Siphan said, was also welcoming efforts to establish the Asean Economic Community (AEC) by 2015, as it would help promote the free flow of skilled labour.

Authorities in Phnom Penh are now working to upgrade the vocational skills of domestic workers so that they will be able to compete against their peers from other nations in the region.

Phay Siphan said the government had been educating Cambodian people about the importance of the AEC and was encouraging them to support its work in the Asean community so the country and its citizens would reap benefits from the initiative.

For Thai and foreign investors in Thailand, the imminent enforcement of a 300-baht daily minimum wage in key manufacturing provinces is prompting fresh interest in Cambodia, said Niyom Wairatpanich, chairman of the Thai Chamber of Commerce committee on border trade.

"It is necessary for us to find cheaper labour markets or our businesses won't survive. Cambodia is our target," said Mr Niyom, who met recently in Phnom Penh with the Thai-Cambodian Friendship Association.

The prospect of improving skills and lower wages in Cambodia are appealing, but some investors remain sceptical about stability as memories of anti-Thai riots nine years ago remain fresh.

Mr Niyom said he had earlier talked to representatives of the Cambodian government who promised investment privileges if Thai businessmen were able to invest in Cambodia immediately.

He said many Thai businessmen, mostly in the garment business, had already decided to seek opportunities in Cambodia, but others had yet to decide because they are uncertain about up-and-down relations between Thailand and Cambodia.

The low point in recent history came in January 2003 after a Cambodian newspaper article falsely quoted Thai actress Suwanant 'Kob' Kongying as claiming that Angkor Wat belonged to Thailand.

Other Cambodian media picked up the completely fabricated report and fanned nationalistic sentiment that resulted in riots in Phnom Penh on Jan 29. The Thai Embassy was burned and properties of Thai businesses heavily vandalised.

The riots resulted in the withdrawal of some Thai businesses and investments because of safety concerns, although business relations have since recovered with compensation paid and properties restored.

More recently, the two countries have sparred over claims to a disputed area covering 4.6 square kilometres near the Preah Vihear Temple. Those tensions have eased, though not completely, since the election of the Pheu Thai Party, helped by the warm personal relationship between Hun Sen and fugitive former Thai premier Thaksin Shinawatra.

Now that relations between the two countries are improving, Cambodia wants the Thai government to help send skilled Thai workers to help Cambodian people now undergoing vocational training at the Cambodian-Thai Skill Development Centre.

Ho Hoey, the centre's director, said he also wanted the Thai government to help construct a dormitory for Cambodian female vocational trainees and help supply modern technologies for Cambodian vocational trainees.

The centre, which the two countries set up in 2000, provides 24 courses for 550 Cambodian trainees at a time in fields including air-conditioning, electrical repair, computer skills, motorcycle repair and hairdressing.

Sompong Sanguanban, the Thai ambassador to Phnom Penh, said the Thai government had already earmarked about 10 million baht to support some of the centre's needs.