The number of projects eligible for incentives under the ‘Special Investment Promotion Programme for Preah Sihanouk Province,’ initiated by Prime Minister Hun Manet in January this year, rose to 63 with the approval of 22 more projects.
The decision on the new projects worth over $2 billion in investments was taken by the Investment Promotion Working Group for Preah Sihanouk recently, a Facebook post said.
The programme was initiated mainly to solve the issue of unfinished and abandoned constructions in the coastal city since 2019.
The latest meetings in this connection were chaired by Hean Sahib, Secretary of State of the Ministry of Economy and Finance and Chairman of the Investment Promotion Working Group, on June 26 and 27 at the Office of the Ministry of Economy and Finance.
“The meetings reviewed the proposals of foreign investors and residents and decided to provide incentives, concessions and legal facilitation to try and settle 22 projects with an investment of more than $2 billion,” the post said.
The meetings were attended by members of the working group and representatives of relevant ministries, including the Ministry of Environment and Ministry of Health and also representatives of the Commercial Gambling Management Commission and Real Estate and Mortgage Business Regulator, besides other officials.
The newly approved projects include 13 stalled building constructions, seven new projects and two expansion projects. They vary from tyre manufacturing, solar panel manufacturing, hotels, resorts, housing development, multi-purpose buildings, schools, and hospitals.
“Continuously from February to date, the team has decided to provide special benefits to 63 investment projects. In the near future, the team will review 26 additional special proposals for investments and incentives,” it added.
The special incentives programme covers four types of projects, such as those involving stranded building constructions, non-stranded buildings that can be operational in 2024, expansion projects and also other existing projects.
Hean Sahib, the leader of the working team, highly appreciated the support, especially the commitment and willingness of the team and the ministries involved in contributing to the implementation of special programmes smoothly and promoting the tourism environment in Sihanouk province.
Meanwhile, the working group encouraged residents and foreign investors who want to receive special benefits for investments under the programme to apply.
The move to solve the crisis created by the unfinished buildings, left mostly by Chinese investors, gathered momentum last year following criticism that they were an eyesore in the coastal city known for its tourism potential.
Since its inception, the Investment Promotion Working Group has been actively implementing measures to attract investment to the province. Its efforts include the creation of designated development zones, the drafting of a sub-decree for granting residence visas for long-term investments and the promotion of existing industrial and special economic zones.
Incentives under the programme include exemption from income tax and minimum tax for an additional three years, exemption from value-added tax till the completion and improvement of stalled building constructions, five-year withholding tax exemption on real estate lease, exemption of property tax and the exemption of various administrative sanctions.
The government had identified 362 stalled building constructions in Sihanoukville as of January 2024. It may be noted that since 2016, investment in Sihanoukville has grown rapidly, especially with the growth of a large number of hotels, restaurants, shops, and other facilities, mostly due to Chinese investments.
However, in the period from 2019 onwards, changes in the socio-economic situation combined with the spread of Covid-19 and other global challenges have caused the construction of many buildings to be suspended or stopped.
The success of all new investments in Sihanoukville, however, depends on the tourism turnaround of the city, said Vichet Lor, Vice-President of the Cambodia Chinese Commerce Association (CCCA) recently.
“Sihanoukville will become a favourable investment destination if tourist arrivals go up to match the pre-Covid-19 levels,” he told Khmer Times.
Vichet said pragmatic and practical solutions are needed to reinvigorate the tourism industry in the coastal city promptly to improve returns on investments.
