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Discussion Starter · #1 ·
Cambodia's bourse plans reflect changing fortunes

PHNOM PENH, June 7 (Reuters) - Cambodia plans to launch a stock market in 2009, Prime Minister Hun Sen said on Thursday, another sign of the southeast Asian nation's accelerating recovery from the devastation of Pol Pot's "Killing Fields".

Hun Sen, a former Khmer Rouge officer who lost an eye in the final assault on Phnom Penh in 1975 by the ultra-Maoist guerrillas, said his government was already drawing up the laws needed to establish a bourse.

"With the start of a stock market, Cambodian people will be able to collect their savings, which can then be used for long-term investment," he told a symposium hosted by the Asian Development Bank (ADB).

Central bank governor Chea Chanto said the laws would be approved "soon".

Per capita income rose to $500 in 2006, Hun Sen said, double 1994 levels when the country was regarded as one of Asia's most desperate basket cases, beset by lingering civil war, a growing AIDS epidemic and defunct economy.

However, growth has taken off in the last few years due to relative political stability under Hun Sen, who has brushed aside accusations of authoritarianism during his two decades in charge.

The garment and tourism industries have mushroomed, with much of the expansion financed by foreign investors, and the new office buildings springing up across the once-sleepy French colonial capital are testament to a roaring construction sector.

The last two rice harvests have also broken records.

The economy grew 10.4 percent last year, according to the International Monetary Fund (IMF), which expects growth of 9 percent in 2007 and 7.5-8 percent in 2008, making it one of the world's fastest-growing economies, albeit worth only $7 billion.

In a big push to banish the legacy of Pol Pot's "Year Zero" revolution and its estimated 1.7 million victims, Phnom Penh has obtained B+ and B2 credit ratings from S&P and Moodys respectively this year.

The ratings should help pull in more foreign direct investment (FDI), as well as encourage commercial lending by the blossoming banking sector, which now boasts 20 institutions, IMF Asia and Pacific adviser Jeremy Carter said this week.

"You have new banks, small banks which have just started to grow rapidly. They are taking in a lot of deposits and they are issuing a lot of new loans," Carter told news conference.

FDI in 2006 was $4 billion -- another record -- and last month a South Korean consortium announced plans to build a $2 billion residential, commercial and cultural complex on the northern outskirts of the capital.

Hun Sen, whose government still relies on foreign aid for 60 percent of its revenues, said on Thursday foreign reserves rose to over $1 billion last year from just $100 million in 1994.

142,739 Posts
Discussion Starter · #2 ·
Work safety worsens as Cambodian construction booms
8 October 2008
Agence France Presse

The race is on to build Phnom Penh's first skyscraper but as the fast-modernising city famous for its graceful colonial skyline transforms, safety standards appear to be stuck in the past.

The construction business in Cambodia is booming, attracting investments of 3.2 billion dollars in the first six months of this year and luring some 40,000 seasonal construction workers from impoverished provinces.

But, as construction worker Chan Vuthy can attest, work safety has deteriorated as buildings spring up.

The day a blade from a malfunctioning saw cut deep into his knee, the 23-year-old was wearing flip-flops, a cloth hat and no protective equipment.

When he stumbled to the bottom of the site, his boss scolded him for recklessness.

He was then fired, and had to spend his savings on a month of hospital treatment.

"Every time other workers and I have accidents, they say we are careless," Chan Vuthy says.

Cambodian construction workers risk their lives for an average wage of two and a half dollars a day, says Sok Sovandeith, president of the Cambodia National Federation of Building and Wood Workers.

There are no laws to force construction enterprises to pay adequate wages so many workers must live on building sites.

Few of them have any training and companies have little incentive to take measures to avoid accidents or use equipment such as hard helmets, work boots or safety harnesses.

"We're very worried about poor working conditions which have not been improved or guaranteed by law," Sok Sovandeith said, adding that construction work is the most dangerous kind of labour in the country.

"We are not happy when workers are not safely equipped. After some inspections, we found a lot of building sites and companies do not give out safety materials."

Many construction companies lay the blame for poor safety on workers who do not protect themselves.

So far the government has sided with businesses, taking no action to ensure better work conditions amid the building boom which has attracted investment from South Korea and China and helped fuel double-digit economic growth.

"The whole country acknowledges that construction is the third gem besides the agriculture and garment sectors to boost the domestic economy," says Im Chamrong, head of Cambodia's General Department of Construction.

"Some construction companies can't afford the safety equipment. We cannot force them to buy it," Im Chamrong says.

With few zoning regulations, new construction projects tower over traditional Khmer homes and the old French villas built in the colonial era.

In June, a South Korean company broke ground on a 52-storey tower slated to be the country's tallest skyscraper when it is completed in 2012, while all across the capital tall buildings are going up.

Once-sleepy boulevards are already crammed with expensive cars driven by the country's growing elite.

But the gap between the rich and the poor is widening, with about 35 percent of the country's 14 million people living on less than 50 US cents a day.

These are the men and women who end up migrating to the capital and risking their lives on building sites for a couple of dollars a day.

There are no statistics for accidents in Cambodia's construction industry, but there are many anecdotes about deaths and injuries to workers.

"There have been a lot of people being killed accidentally, but some companies try to hide the figure of the dead and victims," Sok Sovandeth says, adding the country needs better labour laws to save lives.

"Because workers take what they are offered, no better work conditions are given to them," he adds.

Premium Member
34,145 Posts
Global credit crunch may delay debut of Cambodia bourse

With global markets in turmoil, business leaders say the much-anticipated launch of the Cambodian stock exchange could slide back by up to a year, reported Cambodian daily the Phnom Penh Post.

"Before the crisis hit, we had some doubts over whether the market would be able to launch [on time]. Now [the crisis] adds to the problems," said In Channy, CEO of Acleda Bank, in an interview with the Post last week.

The exchange was scheduled to start trading by 2009 under an agreement with Korea Exchange signed September 2007.

Initial progress was encouraging with Cambodian lawmakers debating and passing a 69-page securities law within a week of the deal being inked.

But with the global financial turmoil slowly spreading to Korea, China and Japan, liquidity has evaporated as investors flee equities.

The second biggest lender in Cambodia, Acleda, was among the first major companies to say they wanted to be listed and had specific capital expansion plans. But the bank's CEO now says that while the company fully supports the stock exchange in principle, current market conditions may delay the launch.

"Perhaps it will take until 2010," said In Channy.

Even before the crisis hit Asia, the nascent stock exchange had encountered a string of problems.

Cambodia's first agency to assess the value of corporate assets opened earlier this month, but business figures were skeptical the new body will be able to establish sufficient nationwide transparency in time to meet the 2009 deadline.
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