Visitor arrivals in Cambodia are growing, and growing fast. In 2017, the country saw a 12% year-on-year jump in the number of tourists, from 5 million to 5.6 million1. Cambodia’s Ministry of Tourism has since raised its target to achieve 7.5 million international arrivals by 2020. For Singapore companies, this spells opportunities in the hospitality and services sector.
A string of new airlines is set to fly to Cambodia in the near future, paving the way for more regional traffic. Coupled with new flight routes, and a new international airport in Siem Reap, visitors will find it easier to travel to the key cities in Cambodia.
In 2016, Siem Reap alone welcomed over five million local and international tourists. About 85% of the hotels in Siem Reap belong to the four and five-star category. Given the lack of hotels in the three-star rating space, you would stand a good chance of capturing the budget or middle-income travellers visiting Siem Reap.
On top of the usual tourist attractions in Siem Reap, such as Angkor Wat Temple, Bayon Temple, Ta Prohm Temple and Koulen Mountain, the Cambodian government plans to further develop Tonle Sap, a freshwater lake region with a high degree of biodiversity.
Riding on Cambodia’s plans to grow the number of international visitors who are looking for adventurous and recreational activities, there are niche opportunities such as countryside cycling tours and river cruises. Therefore, if you are an adventure tour or cruise operator, you should consider bringing your business here.
1: “Cambodia Economic Update: Recent Economic Developments and Outlook”, World Bank Group, April 2018
The rise of an increasingly wealthy and discerning middle class has translated into demand for new consumer products. Singapore trading and distribution companies like Goodhill Enterprises and LSH Cambodia have moved into the Cambodian market to fill the gaps for consumer goods. Goodhill Enterprises is the exclusive distributor of many fast-moving consumer goods and stationary brands, while LSH Cambodia supplies mainly food products to hotels, supermarkets, restaurants etc.
Demand for higher quality education and vocational training is high in Cambodia, where the current supply is insufficient to cater to the growing population. More than 70% of the Cambodian population is below 35 years of age, forming a significant consumer pool which you can tap.2
Several education service providers from Singapore have ventured into Phnom Penh to set up schools. One of them is Singapore International Consortium School, a Singaporean-run international school that provides education services for preschoolers to 12-year-olds from middle-income families.
The Cambodian government wants to develop its human capital and address the lack of skilled labour in the tourism and hospitality sector. Singapore companies offering vocational training in hospitality or tourism can help fill this market gap in Cambodia.
As a start, consider partnering with industry players or associations, such as the Cambodia Tourism Federation. Alternatively, an asset-light mode of entry could be to work with existing schools to provide complementary courses and generate recurring revenue through royalties.
The healthcare industry has much potential for development. Many of Cambodia’s medical institutions lack the necessary equipment and skilled professionals to provide more sophisticated medical care for patients. Well-to-do Cambodians travel to Singapore frequently for health check-ups and medical services.
If you are in the healthcare business, you can leverage the trusted Singapore brand and consider exporting medical services to Cambodia.
2: National Bank of Cambodia, 2017
The Singapore food manufacturing industry is known for food innovation, safety and quality standards. If you run a food company, you can contribute to Cambodia’s agriculture sector in areas such as agri-tech, food processing and food trading.
Although the focus of Cambodian agricultural production is still on rice, the country has diversified into more profitable crops like vegetables, mangos, cassava and maize in the last decade, with positive results.3
Singapore mainboard-listed HLH Group is an example. As an early market entrant to Cambodia, the company owns and runs about 10,000ha of cassava and sugarcane plantations in Cambodia today. It distributes the cassava and sugarcane to the food processing and animal feed milling industries.
3: “Cambodian Agriculture in Transition: Opportunities and Risks”, The World Bank, 19 August 2015