Prime Minister Officially Announces the “Special Program to Promote Investment in Sihanoukville 2024”

On the morning of January 31, 2024, Samdech Moha Borvor Thipadei Hun Manet, Prime Minister of Cambodia, presided over the official launch of the “Special Program to Promote Investment in Sihanoukville 2024.”

Dr. Aun Porn Moniroth, Deputy Prime Minister, Minister of Economy and Finance, and Chairman of the Economic and Financial Policy Committee, said: “Since 2016, investment in Sihanoukville has grown rapidly, especially with the rapid growth of a large number of buildings such as hotels, restaurants, shops, and residential. However, in the period from 2019 onwards, changes in the socio-economic situation combined with the outbreak of COVID-19 and other global challenges have caused many buildings to be suspended or halted. Currently, there are 362 buildings that have been suspended from construction, requiring an additional investment of about $1,161 million to complete the construction, while 176 buildings have been completed but not yet put into operation.”

In order to solve the problem of stuck buildings in Sihanoukville, Prime Minister Hun Manet announced the "Special Benefits" that the Royal Government has decided to put in the framework of "Special Programs" for three types of investment projects: investment projects related to the unfinished buildings; investment projects that are not related to the unfinished buildings; and the expansion of investment and business projects.

First, the "Special Benefits" of the Royal Government provided in the "Investment projects related to the unfinished buildings" include:

- Exemption from income tax, prepayment on income tax, and minimum tax for an additional 3 years;

- Exemption from value-added tax at the rate of zero percent for the completion and improvement of stuck buildings

- Exemption from withholding tax on a real estate lease for 5 years;

- Exemption of property tax and exemption of administrative sanctions

- Exemption from payment of public services and fees in excess of the land use index for construction-related permits;

- Facilitating the procedures and procedures for applying for a permit from the competent authority related to construction work;

- Providing concessions on inspection fees and other certifications related to construction; facilitating investment and business procedures, including applying for licenses, certificates, and permits;

- Establishing policies and facilitation, establishing a real estate market, and providing investor matching services, including a reference price for real estate in Sihanoukville;

- Promoting the use of out-of-court dispute resolution mechanisms in accordance with legal provisions for investment-related disputes.

Second, the "Special Benefits" of the Royal Government provided in "Investment projects that are not related to the unfinished buildings" include:

- Facilitate investment and business procedures, including applying for licenses, certificates, and permits;

- Providing special incentives and incentives such as import tax, patent tax, billboard tax, withholding tax on real estate leases, registration fees, etc. to enterprises that come to invest or do business in Sihanoukville. ;

- Incentives for income tax exemption, prepayment on income tax exemption, and minimum tax exemption for an additional three years for qualified investment projects and tax-registered small and medium enterprises;

- Authorization to apply a zero percent value-added tax for small and medium enterprises registered for the tax purchase of locally produced inputs.

Third, "Special Benefits" provided to the "Expansion of Investment and Business Projects" are as follows:

- Facilitate procedures, and permits for the implementation of projects or activities to expand investment and/or business;

- Providing incentives and concessions such as import tax, patent tax, billboard tax and withholding tax on real estate lease, etc. to enterprises carrying out projects or activities to expand investment and/or business;

- Permission to take 150% multiplied by the income to be received, income tax exemption as a basis for calculating income tax;

- Three-year income tax exemption incentive based on the ratio of the capital expansion rate and the allowance of 150% multiplied by the income tax exemption to be used as a basis for calculating income tax.

In addition to providing "Special Benefits" to the above three projects or activities, the Royal Government has also introduced a number of necessary measures to support and further encourage investment and industrial development in Sihanoukville such as providing a special three-year visa for investors who buy or rent long-term properties in Sihanoukville worth more than $100,000, with this type of special visa determined by a separate sub-decree.

Samdech Thipadei Hun Manet, issued a decision on the establishment of the “Investment Promotion Working Group in Sihanoukville”

On the night of January 30, 2024, Samdech Thipadei Hun Manet, Prime Minister of Cambodia, issued a decision on the Investment Promotion Working Group in Preah Sihanouk Province.

According to the decision on the establishment of the “Investment Promotion Working Group in Sihanoukville” under the umbrella of the Economic and Financial Policy Committee, chaired by Hean Sahip, Secretary of State of the Ministry of Economy and Finance, as the Chairman and three Vice-Chairmen, and 29 other members.

It should be noted that the Investment Promotion Working Group in Sihanoukville has the following duties: to lead, coordinate, and implement the “Sihanoukville Special Investment Promotion Program 2024,” including measures to resolve stuck investment projects in Sihanoukville; and to act as a “One Window Service Mechanism,” which has the right to review, decide, and issue permits or licenses as a package on investment projects and business activities.

In addition, the working group has the role of preparing the necessary documents and procedures for the implementation of the work of the team and good cooperation with the relevant ministries and institutions, publicising the special program widely, explaining clearly and accurately, and providing good hospitality and cooperation for investors and businessmen both in the country and abroad.