PHNOM PENH: The Royal Government of Cambodia has announced a series of measures to assist businesses impacted by the disruption of supply chains due to the closure of the Cambodia-Thailand border. The initiative aims to ease the burden on affected companies and enhance Cambodia’s long-term economic competitiveness.
Speaking at a discussion on “The role of automation and new generation technology in the production chain” at the Koh Pich Convention and Exhibition Center on August 8, 2025, His Excellency Lim Visal, Deputy Secretary General of the Cambodia Investment Board of the Council for the Development of Cambodia (CDC), detailed the government’s response.
According to a CDC official, the government’s strategy includes encouraging local production of raw materials and semi-finished goods to stabilize supply chains, and promoting the use of more local components in manufacturing.
In addition to these immediate responses, the government is focusing on improving the overall investment climate to transform Cambodia into a competitive manufacturing hub. This includes measures such as reducing electricity and logistics costs, developing human resources, streamlining administrative procedures, promoting industrial diversification and attracting industrial clusters from start to finish.
Deputy Secretary General Lim Visal stated that the CDC, in its 7th term, has been tasked with coordinating and reporting on the progress of a package of “sharp reform measures.” These reforms are designed to address challenges facing private investment and consider additional coordination for specific sectors to reduce business costs, ultimately enhancing competitiveness and fostering economic growth.
The Deputy Secretary General’s remarks were made during the “Cambodia International Machinery Industry Fair” and the 9th “Cambodia International Textile & Garment Industry” exhibitions, which took place from August 6 to 9, 2025. During the event, he also highlighted the general investment situation in Cambodia, the attractive incentive regime under the country’s open, transparent, and predictable investment law, and the potential for investment in priority sectors.
Cambodia has successfully diversified its industries beyond the traditional garment, footwear, and bag sectors. New industries now include the assembly of vehicles and vehicle components, and the production of tires, bicycles, electronic and electrical equipment, lighting, Christmas tree decorations, furniture, and plywood. He pointed out that these new sectors utilize medium-level technology and offer reasonable added value.
The Deputy Secretary General expressed confidence that this diversification trend will continue, as the Royal Government is committed to introducing policies and measures to support the private sector and improve Cambodia’s investment and business environment. This is especially crucial given the current global context of various crises and high uncertainty.
CDC officials also emphasized several key factors that make Cambodia a prominent investment destination in Southeast Asia, including, peace and security, political and macroeconomic stability, a young and skilled workforce and also an extensive connectivity with international markets through bilateral and multilateral free trade agreements with numerous countries and regions
A significant development for foreign investors was also noted: as of August 7, 2025, the United States has implemented a tariff reduction to only 19 percent on imports from Cambodia, a change that officials believe makes Cambodia a highly attractive option for foreign investment.
