South Korean construction on services and property investment in Cambodia (1994-2010)

Abstract

The study focuses on the South Korean Foreign Direct Investment in Cambodia on Private Construction companies in Phnom Penh as case study. This research is analyzed through South Korean businessmen’s opinion and the construction industry climate in Cambodia by using the Nine-Factor Model of Dong Sung Cho, Porter’s five forces model, and SWOT analysis. Primary data are collected through the in-depth interview with South Korean Director and Manager of construction companies whereas secondary data is collected from government institutions and other institutions. The key factor for South Korean investors to invest in construction sector is the potential growth of the economic development in Cambodia while cheap labor is not quite important. The obstacles South Korean investors face are corruption, productivity of labor force, importing construction materials, and health of Cambodian economy. Some recommendations to Cambodian government on construction sector are improving rule of law (construction permit procedure and corruption), investing in vocational training, reducing imported construction material and encouraging the local industries in producing construction material.