Cambodia has been ranked first as the most effective emerging marketplace for foreign investment in 2024 in the most recent global index published by fDi Intelligence, a London-based business publisher. The rating is attributed to strong and consistent GDP growth, low inflation and rapid growth in foreign direct investment (FDI) into the country.
The fDi Intelligence Emerging Markets Index also assesses infrastructure, policy incentives for investors, and the power of cities and regions to draw future investment. The report covers the Asia-Pacific region, Europe, North America, Latin America and the Caribbean, the Middle East and Africa and the BRICS countries.
The IMF forecast Cambodia’s GDP growth to be 6.1% in 2024, up from 5.6% previously. New trade partnerships with China, Korea and the European Union also confirm this positive outlook. Foreign direct investment in Cambodia increased by 393% and the number of recent projects increased by 110% because of investor-friendly policies and government improvements to business infrastructure.
After Cambodia, the Philippines secured the second place with a projected GDP growth of 5.9% in 2024, up from 5.3% in 2023. Investment in FDI projects within the country is predicted to extend by 312% and variety of projects by 51% year-on-year.
Cambodia’s rapidly growing tourism sector can be a serious attraction and can see a powerful recovery in 2024 with promising future prospects. With over five million tourists arriving in 2023, contributing around 10% of the country’s GDP, although barely below pre-pandemic levels, tourism is predicted to proceed to grow in the longer term.
fDi Intelligence also commends Cambodia for successfully diversifying its economy since 2019, reducing dependence on traditional exports corresponding to clothing and footwear. Cambodia’s non-apparel exports currently account for 13% of total exports in 2023, including electronic components and vehicle parts. This increases the economy’s resilience to changes in global demand and opens up latest investment opportunities.
Despite the general positive outlook, the index highlights potential risks to the Cambodian economy, particularly in the true estate sector. The deterioration of the economic situation on this sector may affect the banking sector and all the economy. However, the report notes that diversifying equity investments can mitigate this risk.
Overall, Cambodia is seen as a big opportunity for investors in 2024 and beyond, rating it as a number one emerging market in global research.
Other emerging markets in the highest 10 include countries in Africa, Asia and the Middle East corresponding to Kenya, Iraq, Namibia, Kazakhstan, Azerbaijan, Morocco, Serbia and India.
