Gov’t takes serious action to resolve stagnant projects in Sihanoukville

The Government of Cambodia has set out a package of measures to build investor confidence and market demand in the short, medium, and long term for resolving stagnant investment projects in Sihanoukville. This is according to letter No. 356 of the Office of the Council of Ministers dated March 29, 2023.

This package of measures must be implemented in order of priority in accordance with the specific action plan and the definition and scope of the stalemate investment projects from 2016 in Sihanoukville.

The state has defined the term “frozen investment project” refers to construction investment projects such as hotels, business centres, condominiums, hospitals, schools, restaurants and casinos that have been built and suspended or delayed or stopped/and no investment or business activities in Sihanoukville since 2016.

At the same time, the state has set out general measures for resolving stagnant investment projects, such as: identifying, identifying study and analysis areas, establishing outreach and promotion programs, supporting, examining budget feasibility, and promoting mechanisms for resolving stagnant investment projects.

In addition to the incentives for stagnant investment projects, the state provides fiscal and non-fiscal incentives for the following groups of projects:

 - Group Project 1 refers to school projects, hospital projects, duty-free shop projects, retirement housing projects, affordable housing projects and other projects with high economic potential as decided by the Royal Government.

 - Group Project 2 refers to investment activities under the Investment Law of the Kingdom of Cambodia, laws and regulations in force.

 - Group Project 3 refer to business activities such as guesthouses and non-residential buildings that are not under the Investment Law of the Kingdom of Cambodia.

 - Group Project 4 refers to the fund activities of joint ventures and/or governance in accordance with applicable laws and regulations.

Incentive conditions for the four types of projects above must comply with the following conditions:

 - Authorized to import construction materials, construction equipment and production equipment by customs duty, special tax, value added tax at the expense of the state after obtaining a construction permit and assessment of actual needs

 - Must invest to complete the construction /or renovation within 2 years

 - Receive tax incentives after the building is completed and/or renovated.

This package measure is detailed in the appendix of letter No. 1438 MEF dated 23 February 2023 of the Ministry of Economy and Finance.

Source: Construction & Property News