Investment : Foreign investors boost property trusts in Cambodia

At the beginning of July 2024, Cambodia had 925 registered trusts with a total value of $1.47 billion, of which $684 million (67%) was in property trusts.

Phnom Penh. Photo CG

Escrow services followed with $169 million (17%), holdings with $92 million (9%), pension funds with $64 million (6%), fixed deposits with $10 million (1%) and green bonds with $1.2 million (less than 1%). Of the 905 trust cases, 700 involved real estate.

The trust framework, introduced in 2019, has become a popular investment route for expatriates and foreign investors, particularly as they cannot directly buy land in Cambodia.

This aligns with Cambodia's Financial Sector Development Strategies 2016-2025, aimed at boosting investment.

Foreign direct investment is vital to the Cambodian economy, with $48.4 billion in FDI between 2018 and 2023, much of it from China (46%). A significant proportion of trust funds in Cambodia come from foreign investors, offering a secure way to manage wealth and transfer assets. Investor confidence is enhanced by the trust deposit services provided by 17 licensed commercial banks in the country.

In addition, the provision of escrow services by Cambodian banks greatly contributes to investor confidence. Today, Cambodia has no less than 17 licensed commercial banks offering escrow or custody services, including ACLEDA Plc Bank, ABA Bank, Phillip Bank, CIMB Bank, J Trust Royal Bank, Asia Pacific Development Bank, Maybank Cambodia, Bred Bank Cambodia, Wing Bank, Sathapana Bank, BIC Bank, PPC Bank, Canadia Bank, CCU Commercial Bank, Shinhan Bank, SBI Ly Hour Bank, and Cambodia Post Bank.