Real estate

Construction Sector Totaled $5.3b in 2021

Investment in Cambodia’s construction sector amounted to $5.3 billion in 2021, with 4,303 projects approved by the government
Workers work at a construction project in Phnom Penh. Kiripost/Siv Channa
Workers work at a construction project in Phnom Penh. Kiripost/Siv Channa

Construction investment in Cambodia totaled $5.3 billion in 2021, mainly from China, South Korea, and Japan, according to the Ministry of Land Management, Urban Planning and Construction.

The ministry also revealed a total of 4,303 construction projects were approved by the government in 2021.

A recovery in domestic and foreign investment led to Cambodia's construction industry growing by 2.1 percent in 2021, after declining by 1.8 percent the previous year.

The National Bank of Cambodia (NBC) expects the real estate and construction sectors to drive growth this year, primarily due to 4,303 construction projects being approved in 2021.

In the draft Financial Law for 2023, signed by Prime Minister Hun Sen on June 8, the government predicts that the construction sub-sector is projected to continue to recover at a rate of 7.2 percent in 2023.

However, he noted that because of increased demand for family organizing as well as an increase in domestic investment, low and medium cost housing construction is expected to maintain good growth.

General Manager of Cambodia Constructors Association, Chiv Sivpheng, said according to the Ministry's statistics, it is decreasing and data it has checked according to construction permits is decreasing due to the Covid-19 pandemic.

Cambodia's development is sluggish due to the Covid outbreak, which has not attracted foreign investors especially from China, but has few local investments, Sivpheng said.

"In general, the government is recovering the national economy, it is recovering in all sectors. In the construction sector, there is a slight increase, but it is not still," Sivpheng told Kiripost.

"If the Covid pandemic is relieved, any foreign investors will come back to invest in Cambodia because we will have political stability and full vaccination of citizens," he said.

Sivpheng said many construction projects were abandoned during the pandemic. However, construction has now restarted.

Meanwhile, the real estate sector in Cambodia for 2022 is expected to grow by 2.5 percent and will increase by 5.2 percent in 2023 due to expectations of a recovery in high-end real estate buying and selling activities, including condominiums and apartments, said recently released report by the Ministry of Economy and Finance.

According to the Ministry of Land Management, Urban Planning and Construction from 2000 to the end of 2021, the Ministry of Construction issued 57,590 construction projects nationwide. This is equivalent to more than 16 billion square meters, with an investment of more than $66 billion.

In 2020, construction investment totaled $7.8 billion, down 32.1 percent from $11.4 billion in 2019.