Cambodia Business Buzz: Border Talks, Economic Revisions, and Investment Growth Mark the Week

Phnom Penh, Cambodia – The past week in Cambodian business saw a flurry of activity, from diplomatic discussions concerning border trade to revised economic forecasts and major investment announcements.

In the realm of international relations and trade, discussions were held in Phnom Penh to address the Cambodia-Thailand border demarcation. These talks are aimed at resolving outstanding issues, particularly as recent tensions have caused some interruptions in the flow of goods and people across the frontier.

Efforts to strengthen economic partnerships were highlighted by a business forum between India and Cambodia, focused on deepening bilateral trade and investment. The Kingdom's international trade volume continues to grow, having surpassed $25 billion in the first five months of the year, with China as a key partner. Trade under the Regional Comprehensive Economic Partnership (RCEP) has also shown consistent growth.

In agriculture, a large Chinese banana company announced plans for a 50% expansion of its Cambodian operations. Separately, Indonesia has shown interest in purchasing Cambodian rice at competitive prices. Amid these developments, regional concerns were noted regarding the potential impact of US tariffs on ASEAN trade.

On the economic front, Cambodia's growth forecast for 2025 was revised to a more moderate 4.0% expansion, with an emphasis placed on the need for economic diversification for long-term stability. This follows slightly different outlooks from other financial institutions, which also pointed to potential risks from tariffs and the domestic real estate market. The local stock exchange, the CSX, had a variable week, starting with a rise in its index.

Infrastructure remains a powerful engine for the economy. The port in Phnom Penh handled a 30% increase in container traffic from January to May compared to the previous year. Significant progress continues on large-scale projects, including the new Techo International Airport, which is expected to open in July, and the Funan Techo Canal project.

Investor confidence appears strong, as the country attracted $3.4 billion in Foreign Direct Investment during the first four months of 2025, a substantial increase from the year before.

Finally, businesses will need to adapt to new governmental regulations. The Ministry of Labour and Vocational Training has issued new directives related to enterprise payrolls, overtime work, and paid holidays. New tax rules concerning trusts have also been released.