Current business situation
Cambodia is one of the fastest-growing developing countries in East Asia.
Gross domestic product (GDP) grew by 6.9 per cent in 2016. Impressive rates
of economic growth have led to sharp wage increases which undermine the
degree of competitiveness. At the same time, growth has generally been
sufficient to create new jobs needed to absorb the rising working-age
population, which has been increasing at 3 per cent annually (faster
than the population). Unemployment is at 0.3 per cent of total labour force
in 2016 (Source: World Bank).
With a median age of 24.2 years, Cambodia has one of the youngest
populations in Southeast Asia (Source: Worldometers). It is
anticipated that the Cambodian population will continue to grow, reaching
nearly 17 million by 2020. This provides good opportunities for economic
development, given the large base of young and dynamic workers.
Although the majority of Cambodians live in rural areas, economic
development and improving employment opportunities in the largest cities
are anticipated to sustain the urbanisation process in the future.
The Cambodian economy is growing rapidly on the back of the following main
manufacturing (exports of garments and footwear)
food and beverage
The manufacturing sector is Cambodia’s primary economic driver. Textiles
and clothing industries dominate the sector and attract increasing interest
from foreign investors.
The real value of tourism rose by 7.6 per cent in 2015 and was expected to
gain 6.2 per cent in 2016 as a result of arrivals from other parts of Asia.
Australia ranks 18th of Cambodia’s most important trade partners in both
directions of trade, valued at $535 million in 2016. Australia’s main
exports to Cambodia are wheat and cereal preparations, while it mainly
imports textile clothing and footwear from Cambodia.
Australia and Cambodia enjoy a close relationship and there are many
opportunities in industries including:
premium food and wine
agribusiness (dairy and live cattle)
banking and finance
Many of these are shared in other parts of Asia, with Thai business
practice bearing perhaps the closest resemblance.
Cambodians traditionally greet each other by pressing their palms together
in front of their bodies and bowing, called a 'sompeah'. Generally a
younger or lower rank person initiates the greeting. This custom has been
partially replaced by the Western practice of shaking hands. It is
considered acceptable for foreigners to shake hands with Cambodians of both
The head is regarded as the highest part of the body, both literally and
figuratively. As a result Cambodians don’t approve of touching anyone
there, even in a friendly gesture.
If possible, a business card in both English and Khmer should be presented
during the initial greeting.
While English is becoming more widely spoken, foreigners should try to
ascertain whether their partner is fluent in English. If not, utilise an
interpreter to ensure a smooth meeting and follow-up.
While the Khmer language is not easy, Cambodians will sincerely appreciate
any efforts to learn their language. Basic greetings or several words in
Khmer, even if mispronounced, will act as a good icebreaker in business
dealings and show that you are keen to understand an integral part of
Cambodian businessmen can be addressed with 'Mr' and their first name, or
for women, 'Madam'. High level government officials usually have the title
In Cambodia, social engagements such as eating or playing golf are useful
to create a level of mutual trust and understanding between business
partners. Foreign businesses who have been successful in Cambodia have
taken considerable time to build the necessary business and government
contacts to operate successfully.
Face-to-face contact is very important in initial dealings with Cambodians
as is a capacity to understand a very different set of viewpoints. Foreigners
should take care to avoid a confrontational or aggressive style in their
business meetings. Cambodians are generally not direct or forthright in
their dealings and take to subtle, rather than blunt, messages. Cambodians
will often say yes to direct questions, but this may only mean that they
hear and understand you, but nothing more.
It is very important to determine at the outset in any business dealings
the hierarchy and seniority of whom you are dealing with, and those
responsible for decision-making. Correspondence and communications should
be addressed to the senior decision-makers. Bear in mind that decisions
often take a considerable length of time as they are relayed up and down
the chain of hierarchy due to the lack of delegation within companies or
A small token of gratitude in the form of a gift is always appreciated when
visiting a Cambodian. Gifts should always be offered with the right hand.
Links and resources
Government, business and trade
Australian Embassy in Cambodia
International Monetary Fund (Economic update)
Ministry of Commerce
Ministry of Foreign Affairs and International Cooperation
Phnom Penh City Government
General Department of Customs and Excise
General Department of Taxation
News and media
The Cambodia Daily
The Phnom Penh Post
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