Since the second half of 1994 Cambodia has attracted in the region of three billion united states dollars in foreign investment. This is a radical departure from the problems suffered by the Cambodian people over the last twenty years and demonstrates the potential of the country to become a market worthy of consideration by foreign investors.
Foreign Investment Authorities
In August of 1994 the government of Cambodia passed the Law on Investment in the Kingdom of Cambodia (the "Foreign Investment Law") and at the same time established the Council for the Development of Cambodia ("CDC") and the Cambodia Investment Board ("CIB"). The role of the CDC is to act as a "one stop" government agency for foreign investors and through the CIB (which is a division of the CDC) consider investment applications. The Foreign Investment Law charges the CDC with handling all necessary relations with other Ministries with a view to procuring all necessary approvals and consents in respect of individual projects. According to recent figures published by the CIB, more than 70 private investment projects were approved by the CDC in the first 6 months of 1995.
The CDC is a body comprising of individuals who formally meet once a month to discuss the state of foreign investment into the country and related issues. The co-chairmen are the two Prime Ministers, the vice-chairman is the senior minister responsible for Rehabilitation and Development. The other members are the senior ministers in charge of Culture, Arts, Land Management and Urbanisation; the Minister of Public Works and Transport, the Minister of Foreign Affairs and the Minister of Economy and Finance and Planning. There are also secretary-generals of the CDC, the Cambodian Rehabilitation and Development Board and the Cambodian Investment Board (together the "CDC Secretary Generals").
The Structure of the CDC
Regulation and supervision of the CDC's daily affairs is taken care of by an executive committee, which comprises of the co-chairmen, the vice-chairman and the three CDC secretary generals. This panel meets bi-weekly. The secretary-generals, inter alia, are each assisted by a deputy secretary-general appointed from a different political party. By formally having two rather than one person in place, a check has been installed into the system which is also designed to ensure bi-partisan support for actions taken.
The CDC also has a General Secretariat which directs the CDC through its four divisions:
- Finance and Administration
- Personnel Management
- Strategic Planning
- Legal and Dispute Resolution
The CDC's Secretary General is responsible for the management of the General Secretariat.
The CIB Division
The CIB, as mentioned above, is a division of the CDC, and is responsible for the launching and administering special development zones, suggesting new legislation for the advancement of Cambodia's investment climate and has the authority to grant incentives to approved projects. It co-ordinates relations between investors and the pertinent government ministries, and has the authority to make recommendations on environmental issues.
The CIB is accountable to the Council of Ministers (the "Council"), which must in special circumstances grant approval including where the project involves:-
- Exploration and exploitation of mineral and natural resources;
- Capital investment in excess of 50 million U.S. dollars;
- Projects with politically sensitive implications;
- Adverse effects on the environment;
- Long term national strategic planning;
- Projects which involve Build-Own-Transfer (BOT), Build-Own-Operate-Transfer (BOOT), Build-Own-Operate (BOO) or Build-Lease-Transfer (BLT).
The Cambodian Rehabilitation and Development Board
The Cambodian Rehabilitation and Development Board supervises public sector investment and co-ordinates between the government, donor countries, NGO's and international organisations. It also acts as the distributor of external aid to government ministries and institutions.
High-ranking officials from the pertinent government ministries are appointed to the CDC to assist in the co-ordination of interministerial decisions. They must have foreign language skills, and in addition their authority is required to be delegated from the head of the institution they represent. These appointed representatives and the CDC-officials are required to meet on a regular basis to take decisions. The decisions are then forwarded to the Secretary-General of the CDC, who in turn conveys them to the executive committee. The CDC is designed to act as a vehicle for the central co-ordination of activities and relations between government ministries, investors, NGO's and donor countries.
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