Return of FDI to pre-pandemic levels seen as key to economic growth

While Covid-19 has had an overall negative effect on global foreign direct investment (FDI), Cambodia appears to be prepared to withstand this deficit as international companies look to diversify their investments in the Kingdom.

According to Enhanced Integrated Framework (EIF), a multilateral partnership dedicated to assisting least developed countries (LDCs), FDI fell in Asia by 27 percent to $9 billion in 2019. This was the first time Asia saw an aggregate decline in FDI in eight years.

Despite this, Cambodia reported its highest ever FDI in 2019, valued at $3.7 billion, according to the 2020 World Investment Report by UNCTAD.

Its main investors were China, which accounted for 43 percent of FDI in the Kingdom, South Korea which contributed 11 percent, Vietnam at seven percent and Japan and Singapore, tied at six percent each.

According to global credit insurer Coface, FDI decreased worldwide by 49 percent during the first semester of 2020 compared to the same period in 2019.

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