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FDI in Figures

FDI inflows to Cambodia have grown exponentially in the last few years due to sound macroeconomic policies, political stability, regional economic growth, and an open investment market. According to the World Investment Report 2023 by UNCTAD, FDI inflows saw a 2.7% rise in 2022, reaching USD 3.6 billion. Although the values for new greenfield projects were modest, standing at USD 661 million, the country witnessed 12 significant international project finance transactions totaling USD 1.2 billion. One notable project is the joint venture between PESTECH International (Malaysia) and Hydrogène de France (France) for the construction of a hydropower plant along the Cambodia-Malaysia border, with an investment of USD 241 million. At the end of the same period, the total stock of FDI was estimated at USD 44.5 billion, around 156% of the country’s GDP. As per the ASEAN+3 Macroeconomic Research Office, Cambodia has sustained strong inflows of FDI over the last decade. Between 2013 and 2022, the average yearly FDI inflow surged to 12.1% of GDP, surpassing this mark in the initial three quarters of 2023 (reaching 13.1%). Cambodia attracted fixed-asset investment of USD 4.92 billion in 2023, up 22% from USD 4.03 billion a year earlier (data Council for the Development of Cambodia). In general, the main investing countries are China, followed by South Korea, Vietnam, Japan, and Singapore (National Bank of Cambodia). The construction industry attracts the largest share of foreign investors, followed by infrastructure, industry (especially textiles), agriculture, and tourism.

The government of Cambodia has made attracting foreign investment a top priority, highlighted by the passage of a new Investment Law in 2021 aimed at attracting more FDI, particularly in burgeoning sectors like agro-processing, electronics/machinery, healthcare, industrial parts, infrastructure, and green energy. Most sectors allow for full foreign ownership of companies, though a few, such as cigarette manufacturing, movie production, rice milling, and gemstone mining and processing, may require local equity participation or prior authorization from authorities. The Council for the Development of Cambodia (CDC) plays a pivotal role in incentivizing investment. Investors must submit their proposals to either the CDC or the Provincial-Municipal Investment Sub-committee to secure Qualified Investment Project (QIP) status, contingent upon capital level and investment location. QIPs become eligible for specific investment incentives thereafter. Investors are enticed with various incentives for foreign direct investment, including full foreign ownership of companies, corporate tax breaks, reduced corporate tax rates, duty-free importation of capital goods, and unrestricted capital repatriation. Moreover, Cambodia has established Special Economic Zones (SEZs) to enhance and streamline foreign investment opportunities, and three significant trade agreements came into effect in 2022: the Cambodia-China Free Trade Agreement (CCFTA), the Cambodia-Korea Free Trade Agreement (CKFTA), and the Regional Comprehensive Economic Partnership (RCEP). Despite these incentives, challenges for potential investors include systemic corruption, a shortage of skilled labor, insufficient infrastructure (leading to high energy costs), opacity in certain government approval processes, and preferential treatment towards local or other foreign companies involved in corrupt practices, tax evasion, or exploiting Cambodia's weak regulatory environment. The country ranks 101st among the 132 economies on the Global Innovation Index 2023 and 106th out of 184 on the latest Index of Economic Freedom.


Country Comparison For the Protection of Investors

  Cambodia East Asia & Pacific United States Germany
Index of Transaction Transparency* 6.0 5.9 7.0 5.0
Index of Manager’s Responsibility** 10.0 5.2 9.0 5.0
Index of Shareholders’ Power*** 4.0 6.7 9.0 5.0

Source: Doing Business - Latest available data.

Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action.

Foreign Direct Investment 202020212022
FDI Inward Flow (million USD) 3,6253,4833,579
FDI Stock (million USD) 36,902.741,025.244,537.1
Number of Greenfield Investments*
Value of Greenfield Investments (million USD) 1,630125661

Source: UNCTAD - Latest available data

Note: * Greenfield Investments are a form of Foreign Direct Investment where a parent company starts a new venture in a foreign country by constructing new operational facilities from the ground up.


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Tax Rates

Value added tax (VAT)
10% (standard rate).
Exported goods and services rendered outside the country are zero-rated, same as for the supporting industries or contractors who directly supply goods or services to export-oriented garment, textile, footwear, bag, handbag, and headwear manufacturers, milled rice exporters, and domestic supplies of paddy rice.
Public postal services, medical and dental services, electricity, water, transportation of passengers by wholly state-owned public transport systems, insurance services, primary financial services, and land are exempt.
Company Tax
Withholding Taxes
Dividends: 0 (residents)/14% (non-residents; in addition to the advance tax on dividend distributions); Interests: 14% (non-resident)/15% (resident); Royalties: 14% (non-resident)/15% (resident).
Bilateral Agreement
Cambodia and Spain are not bound by a Double Taxation Agreement.
Social Security Contributions Paid By Employers
0.8% for the Occupational Risks Contribution (ORC).
2.6% for the National Social Security Fund (NSSF).
Other Domestic Resources
Cambodian General Department of Taxation
Overview of Cambodia's tax measures in response to Covid-19
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.

Individual Taxes

Monthly tax on salary (residents) Progressive rate from 0% to 20%.
KHR 0 - 1,200,000 0%
KHR 1,200,001 - 2,000,000 5%
KHR 2,000,001 - 8,500,000 10%
KHR 8,500,001 - 12,500,000 15%
KHR 12,500,001 and above 20%
Non-residents 20% flat rate
Fringe benefit 20%

Country Comparison For Corporate Taxation

  Cambodia East Asia & Pacific United States Germany
Number of Payments of Taxes per Year 40.0 23.4 10.6 9.0
Time Taken For Administrative Formalities (Hours) 173.0 195.1 175.0 218.0
Total Share of Taxes (% of Profit) 23.1 33.8 36.6 48.8

Source: Doing Business - Latest available data.

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Investment Opportunities

Tenders, Projects and Public Procurement
Tenders Info, Tenders Worldwide
DgMarket, Tenders Worldwide
Setting Up a Company
Consult Doing Business Website, to know about procedures to start a Business in Cambodia.
Useful Resources
Cambodia Investment Agency
The Council for the Development of Cambodia (CDC)
Contact the Spanish Embassy.
Contact the Embassy in Spain.
Asia Trade Hub

Business Setup Procedures

Setting Up a Company Cambodia East Asia & Pacific
Procedures (number) 9.00 7.25
Time (days) 99.00 29.73

Source: Doing Business.


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Latest Update: May 2024

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