PHNOM PENH: Malaysians have been flocking to Cambodia since the 1990s and for some years, they were the largest investors, with official data showing that from 1994 to 2001, Malaysian investments comprised nearly a third of all investments and nearly 80% of total Asean investments.
For a number of entrepreneurs including K.C. Chang, the lure include cash transactions made in no less than US dollars.
He considers now as the best time as “the buying power has gone up and people are ready to spend their money”.
Chang set up his business in Cambodia’s capital eight years ago and remembers well the dusty streets strewn with garbage and no streetlights.
Over the period, he has also witnessed the rapid transformation of the city with new areas being cleared for development and the construction of condominiums.
“Soon, a shopping mall was being built right in front of my office-cum-budget hotel.”
The capital now has tarred roads and artisan cafes/eateries line the streets.
Car showrooms have mushroomed along the main road to the city while the skyline has transformed with the construction of a Parkson building by the Lion group and an Aeon mall.
Malayan Banking Bhd, CIMB Group Bhd, RHB Capital Bhd and Public Bank Bhd have a presence in the country. Chang attributed the ease of doing business in Cambodia to a mature banking system and the government policy to allow businesses to be wholly-owned by foreigners.
“We are not allowed to buy land but we can buy condominiums from the first floor upwards,” he told StarBiz.
On how he became involved in Cambodia, Chang said: “It was in 2007 that I was informed of the Government’s plan to develop land at the location of the existing new airport. The project was too big and required international funding.
“Finally it fell through for us. By then the price of land in Phnom Penh had escalated beyond belief,” he said, adding that Malaysians were the largest foreign community there then but have since been overtaken by the Japanese.
Chang stayed on to explore other business opportunities and business ventures.
A measure of his entrepreneurial success can be measured by his taking four shoplots in the then newly-opened Aeon mall to run a bubble tea stall, gift shop, money exchange and a phone shop. He also imported health food from Malaysia under the Nature Pure brand.
Chang remains positive about Cambodia’s economic outlook, pointing out that status-conscious Cambodians were hungry for consumer staples such as handphones. In fact, business has been so good that his phone shop had to stock up on more iPhone 6.
“My next focus is the property business,” Chang said, pointing to the condominiums being built for the emerging middle-class.
He is planning to venture into the property management and renovation businesses together with partners besides looking into exporting Cambodian agricultural products to Malaysia and other countries in the region.
However, as in any emerging economy, there will surely be pitfalls. For Chang, the lack of skilled workers and a completely different work culture remain challenges to doing business in the country.
“Wages for a local worker who does not speak English are US$140 (RM518) a month but those who speak English get US$250 (RM925) a month,” he said, with employers forced to learn Khmer language to get around this issue.
Chang advised those who plan to start businesses in Cambodia to have patience in teaching the employees and keeping them happy.
“If the government policy doesn’t change and it is politically stable, I think this country is going to have a bring future.”
Watch Cambodia: New biz frontier on www.thestar.com.my/video