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Visa, the global payment company, aims to expand its electronic payments in Cambodia, seeing the country’s economic growth as a chance to expand.

Sean Preston, Visa’s country manager for Vietnam, Cambodia and Laos, set out the investment expansion plan at a meeting with Economy and Finance Minister Aun Pornmonirath last week.

“Visa has been cooperating with local banks to use Visa credit and debit cards, aiming to expand more business in the country,” Mr Preston said.

“Due to the economic growth in Cambodia in consecutive years, Visa card usage rose by 65 percent in 2017.”

He said he expected Visa use to keep increasing this year.

“Visa also aims to cooperate with the Ministry of Economy and Finance to study the feasibility of tax payment or other revenues via an electronic payment system, which will give another use in the future,” Mr Preston said.

Mr Pornmonirath welcomed electronic payment for income collection and any feasibility study.

Electronic payments were important for the economy to be effective and for financial inclusiveness.

“Nowadays in terms of attracting foreign investments and encouraging and protecting foreign investments, Cambodia had been implementing a ‘Friendly Business Environment’ policy,” he said.

“Implementing this will give more encouragement to foreign investors with confidence in Cambodia.”

Visa announced in September last year its credit and debit cards were accepted at Angkor Wat, one of world’s most popular tourist destinations, to drive tourism and increase the shift from cash to electronic payments in Cambodia.

Visitors to Cambodia can use their Visa cards at more than 7,000 merchant locations and more than 1,000 ATMs across the country.

KHNER TIMES

The rail link from Phnom Penh International Airport to the city will be ready for service before the start of Khmer New Year in the middle of this month, officials say, as the first tests of the service were conducted on Sunday.

The Royal Railways service connects the airport with the existing rail line. The new link is about 1.6km long.

Construction of the line started in January and is now complete.

Chan Kimleng, director of the railway department at the Ministry of Public Works and Transportation, said the station inside the airport was still under construction but the link would be ready for service before Khmer New Year.

The official launch of the airport service would be announced later, Mr Kimleng said.

The government says the service will be free for the first three months and will be used by local and foreign airport passengers.

Royal Railways, owned by conglomerate chief Kith Meng whose company also manages the country’s railway network under a 30-years exclusive concession, could not be reached for comment yesterday.

Sun Chanthol, Minister of Public Works and Transportations, said last month that the airport rail link would will help reduce traffic congestion between the city and the airport area.

The rail link will use three carriages which the company imported from Mexico. The train is said be able to carry about 150 passengers at a time with a travelling time of 20 to 25 minutes between the airport and the city.

Mr Kimleng said that as a first step, the firm would probably use its existing train which would be replaced after the ordered carriages arrived.

Beside the airport railway service, another rail service is about to be launched tomorrow connecting Sisophon to Poipet city. Mr Kimleng said this would also be free of charge for the first three months.

Sorry, this entry is only available in JP.

Sorry, this entry is only available in JP.

Mizuho Bank, one of largest banks in Japan, has started operations in Cambodia with its first branch in Phnom Penh.

Bank general manager Takeshi Fukui said the venture would provide financing to investors and entrepreneurs, both local and foreign, in Cambodia.
“The branch opened on April 19 and is providing a source of finance in Cambodia,” Mr Fukui said.

“Financing for individuals and SMEs is available in the country. But what’s lacking is financing for large entrepreneurs and big companies.

“That’s where we at Mizuho can help fill the gap,” he added.

Mr Fukui said Cambodia is important as an important regional player in Asean in terms of connectivity and transport links.

“We are here because of Cambodia’s geo-strategic position,” he said, adding that the opening of a branch in Cambodia was also to attract Japanese investors.

Direct flights between the two countries by Japan’s ANA airline were bringing more Japanese people, particularly businessmen.

A series of seminars related to business matching would be conducted to attract Japanese investors, Mr Fukui said.

The bank received a licence from the National Bank of Cambodia in February.

Chea Serey, director-general of the NBC, said earlier that Mizuho Bank would play an important role in attracting more Japanese businessmen.

“Mizuho will bring in Japanese investors for years to come,” Ms Serey said.

With the number of Japanese companies settling in the kingdom and creating jobs markedly on the rise, Prime Minister Hun Sen reminded Japanese businesses yesterday of the important contribution they make to the local economy and asked them to keep investments into the country flowing.

Mr Hun Sen spoke during a meeting with a delegation of Japanese businessmen headed by Chang-Woo Han, chairman of Maruhan Group, which recently acquired Sathapana Microfinance Institution.

The prime minister urged Mr Han to continue to expand the operations of his business in the kingdom, pointing out the tremendous benefits to the local economy and to Cambodian society of Japanese investment.

“I asked Mr Abe to encourage Japanese investors to explore possibilities in our aviation sector by creating more direct flights between Cambodian and Japan, as well as to consider investing in local infrastructure,” the premiere said, referring to his August trip to Japan where he met with Japanese Prime Minister Shinzo Abe.

During the encounter with the Cambodian leader, Mr Han announced plans to build a 22-storey building for his bank on Phnom Penh’s Norodom Boulevard next year, which will be completed by 2020 and worth about $60 million.

Maruhan Group has $120 million in assets in the kingdom and 168 branches nationwide. It employs about 4,300 people, taking 15 percent of the pie in the local banking sector, according to the bank’s representatives.

According to the CDC, Japanese companies are now involved in 115 different projects in the country, which in total are worth $1 billion and have created 36,000 jobs.

Cambodia’s economic growth is expected to remain stable this year with inflation rising slightly on increases in the costs of global fuel and food prices, the Asean+3 Macroeconomic Research Office (AMRO) concluded following its annual consultation visit to the Kingdom.

“Cambodia’s economy is expected to grow strongly at 6.9 percent in 2017 with inflation reaching around 4 percent,” AMRO lead specialist Seung Hyun Hong said yesterday in a press release.

“Despite sustained growth in the garment, construction, and tourism sectors, headwinds to growth emanate from rising labour costs and ongoing adjustments in the real estate sector.”

The release followed an annual consultation visit by AMRO in June in which a team from the regional think tank visited the Ministry of Economy and Finance (MEF) and the National Bank of Cambodia (NBC) to study near-term growth prospects, financial stability, policy development and efforts to promote industrial diversification.

In its report, AMRO recommended that the Cambodian government enhance labour quality, improve trade facilitation and reduce logistics and electricity costs to mitigate the adverse effects of continued rises in the cost of labour.

“As [the] manufacturing industry started to show early signs of diversification, [a] broadening economic base is essential for long-term sustained growth,” it said.

The report added that with the Kingdom’s monetary policy constrained by high dollarisation, the NBC should adopt risk-management strategies to enhance financial stability through a “forward-looking” approach that regularly stress tests banks and enhances interconnectedness.

On the infrastructure front, AMRO said the national budget should be rebalanced to allocate for more capital investment.

“In the face of rising labour costs and [a] relatively large infrastructure gap, fiscal policy needs to be more supportive of much needed infrastructure investment and structural reforms to enhance productivity and support growth,” the report said.

AMRO applauded the government’s prudent strategy to enhance tax-revenue collection that has contributed to a decline of the Kingdom’s deficit, giving Cambodia space to continue to borrow in the short term and help build fiscal space to support economic growth.

However, the report advised that over the medium term, the government should pursue additional sources of funding by supporting the domestic capital market and increasing its collaboration with the private sector.

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