Chinese textile giants eye Cambodia as a new industrial frontier

Cambodia is increasingly emerging as a land of opportunity for major Chinese textile companies. Four major groups based in Shandong province have recently expressed an interest in developing their activities here, with their sights set on the global fashion and textile markets.

During an economic mission led by H.E. Samheng Bora, Secretary of State at the Ministry of Commerce and Chairman of the Export Promotion Working Group, from 20 to 21 September, strategic exchanges took place with leading industrial executives.

Among them were the conglomerate Sunvim Group Co, Ltd, a leader in home textiles, Sinoer Menswear Co, Ltd, a well-known manufacturer of men's fashion, and two agri-food companies, Shandong Jinsheng Grain and Oil Food Co, Ltd and Shandong Yuhuang Grain and Oil Food Co, Ltd.

Confirmed investment intentions

The Sunvim group, which is already active internationally, has announced its intention to send a delegation to Phnom Penh in the very near future. The purpose of this exploratory mission will be to study in detail the legal framework, the availability of manpower and investment conditions. For its part, Sinoer Menswear has also confirmed its willingness to analyse the opportunities offered by Cambodia in order to increase its export capacity to Western and South-East Asian markets.

H.E. Samheng Bora, for his part, encouraged these companies to take the plunge. He pointed out that the Kingdom has significant competitive advantages, including attractive tax breaks, preferential access to certain Western markets - including the European Union through the “Everything But Arms” scheme - and a relatively young and growing workforce.

Cambodia, home to the textile industry

The clothing sector is already Cambodia's main source of export revenue, with more than 6,500 factories employing around 800,000 workers, according to data from the Ministry of Industry. In 2024, exports of clothing, textiles and footwear accounted for more than US$8.6 billion, or more than 50% of the country's total exports (source: National Bank of Cambodia).

The sudden interest of the Chinese giants comes against a backdrop of global reorganisation of supply chains. Faced with rising production costs in China and geopolitical tensions, many manufacturers are looking for alternative platforms in South-East Asia. Cambodia benefits from its geographical proximity to China, while offering a framework for regional integration thanks to its membership of ASEAN and the Regional Comprehensive Economic Partnership (RCEP) agreement, the world's largest free trade treaty.

Future prospects

Analysts believe that the potential arrival of Chinese groups with strong technological capabilities could boost the competitiveness of the Cambodian textile industry, which is still often confined to subcontracting. Investment in more modern factories, focused on moving products upmarket, would pave the way for diversification of exports and better development of the local industry.

‘The installation of major international producers would be a crucial step, not only to stimulate employment, but also to develop Cambodian know-how that is truly competitive with neighbouring countries such as Vietnam and Bangladesh’, says a researcher at the Cambodian Institute for Development Research (CIDS).

As the Chinese delegation prepares its evaluation missions over the coming months, Phnom Penh seems determined to consolidate its image as a key textile hub in South-East Asia. Cambodia, long regarded as a simple low-cost production base, is now seeking to position itself as a recognised player in the global clothing value chain.