Saturday November 24, 2007ANUCHIT NGUYEN
Bangkok PostCambodia is seeking $3 billion of investments to build power plants in the next decade to meet rising energy demand in Southeast Asia's fastest-growing economy, Commerce Minister Cham Prasidh said.
The nation plans to boost generating capacity by 2,000 megawatts from 300 megawatts by 2017, Cham Prasidh said in an interview in the capital Phnom Penh.
The government is in talks with Chinese and Vietnamese investors to build hydropower plants with a combined capacity of 1,100 megawatts, he said, without naming the companies.
Cambodia's economy has expanded at an average annual pace of about 11% in the four years ending 2007, according to the Asian Development Bank, spurring demand for energy. The nation, which emerged from a two-decade civil war in 1993, is wooing overseas companies to invest in natural gas exploration and power plants to ease electricity shortages and ensure energy supplies.
The energy shortage "problem must be resolved as soon as possible because it's hard to attract foreign investments with unstable power supply," Cham Prasidh said.
Cambodia's economy, which relies on garment exports and tourism, may grow 9.7% this year, Prime Minister Hun Sen said on Nov 7. Companies such as Club Me'diterrane'e SA and Starwood Hotels and Resorts Worldwide Inc are planning to build hotels to tap the country's rising tourist arrivals.
Poor Infrastructure "Cambodia has very low labour costs that can even compete with China," said Van Sou Leng, chairman of the Cambodian Garment Manufacturers Association, a trade group. "Investors are cautious to invest here because of poor infrastructure such as electricity, roads and ports."
Exports in 2006 rose 24% to $3.45 billion, according to Cambodia's central bank. Garments accounted for 70% of total overseas shipments, with the US and European Union the nation's biggest markets.
Foreign tourists to Cambodia may reach a record two million in 2007, Hun Sen said. Overseas tourists rose 19% to 1.4 million in the first nine months of this year, he said.
"Most large hotels in Cambodia have their own power generator because the power blackout situation has worsened," said Cham Prasidh.
The country currently buys electricity from Vietnam and Thailand.
The government is in discussions with Chinese investors to build two hydropower plants with a combined capacity of 700 megawatts in the northwest province of Pursat, said Cham Prasidh. A group of Vietnamese investors plans to build hydropower plants with capacity of 400 megawatts in the northeast province of Rattankiri province, he said.
Cambodia will also open bids for gas-fired power plants which will use natural gas from its onshore and offshore reserves, Cham Prasidh said, without elaborating.
The economy of Cambodia will be the fastest growing of nine Southeast Asian nations this year, according to the ADB. It also reported the quickest pace in the region in 2006 and 2005.
