Capital investment in newly-approved construction projects over the first eight months of 2021 reached $3.843 billion, contracting by 24.4 per cent year-on-year, largely as a result of the protracted Covid-19 epidemic.
The Ministry of Land Management, Urban Planning and Construction greenlit 2,901 construction projects in January-August, falling by 13.40 per cent or 449 projects from the year-ago period, the Ministry of Economy and Economy reported.
The data show that 2,530 projects or 87.21 per cent were residential developments, dipping by 445 projects or 14.96 per cent year-on-year.
The finance ministry underlined that the Cambodian economy continues to be affected by the Covid-19 crisis – especially after the February 20 community event – which drags on to date and exerts pressure on key indicators of economic growth.
Cambodia Constructors Association general manager and secretary Chiv Sivpheng told The Post that Covid-driven restrictions related to trans-border human movement have deterred many foreign entities from investing in large-scale construction projects in the Kingdom.
Apartments and gated-community “borey” developments owned by local investors, on the other hand, have avoided much of the chaos that has enveloped the sector, he noted.
“The number of projects and overall capital investment in the construction sector will increase when cross-border travel is reopened,” he said, highlighting a steady uptrend in investment by locals during the Covid-19 crisis.
Cambodia is planning to reopen soon to foreign guests fully vaccinated against Covid-19, to boost national economic growth.
Last year, the construction ministry approved just $7.8 billion in new construction projects – down by 32.1 per cent from $11.4 billion in 2019, covering 17 million sqm, down by 26.9 per cent, the National Bank of Cambodia reported.
The residential, commercial and industrial segments made up the largest share of new projects, accounting for 46.1 per cent, 31.8 per cent and 14.6 per cent, respectively, the central bank said, adding that foreign direct investment (FDI) inflows to construction and real estate fell by 10.6 per cent, accounting for 17 per cent of FDI stock.
On the other hand, the number of new construction projects grew by one per cent last year, with 4,841 projects receiving the green light. That rate was 45.5 per cent in 2019.