Cambodia has claimed the first place as the best emerging market for foreign investment in 2024 in the latest global index published by fDi Intelligence, a London-based business publishing company. The ranking is attributed to strong and consistent GDP growth, low inflation rates and a rapid increase in foreign direct investment (FDI) into the country.
The fDi Intelligence Emerging Markets Index also assesses infrastructure, policy incentives for investors, and the ability of cities and regions to attract future investment. The report covers the Asia-Pacific region, Europe, North America, Latin America and the Caribbean, the Middle East and Africa, and the BRICS countries.
The IMF forecasts Cambodia's GDP growth to reach 6.1% in 2024, up from 5.6% previously. New trade partnerships with China, Korea and the European Union also support this positive outlook. Foreign direct investment in Cambodia has grown by 393%, with new projects increasing by 110%, driven by investor-friendly policies and government improvements to business infrastructure.
After Cambodia, the Philippines secured second place with projected GDP growth of 5.9% in 2024, up from 5.3% in 2023. The country is expected to see a 312% increase in FDI project investment and a 51% increase in the number of projects year-on-year.
Cambodia's fast-growing tourism sector is also a major attraction, experiencing a strong recovery in 2024 with promising prospects for the future. With over five million tourists arriving in 2023, contributing around 10% of national GDP, although slightly below pre-pandemic levels, tourism is expected to continue to grow in the future.
fDi Intelligence also commends Cambodia for successfully diversifying its economy since 2019, reducing dependence on traditional exports such as apparel and footwear. Cambodia's non-garment exports now account for 13% of total exports in 2023, including electronic components and vehicle parts. This increases the economy's resilience to global demand shifts and opens up new investment opportunities.
Despite the overall positive outlook, the index points to potential risks in Cambodia's economy, particularly in the property sector. A downturn in this sector could affect the banking sector and the economy as a whole. However, the report notes that diversification of capital investments can mitigate these risks.
Overall, Cambodia is identified as a significant opportunity for investors in 2024 and beyond, positioning it as a leading emerging market in global surveys.
Other emerging markets in the top ten include countries from Africa, Asia and the Middle East, such as Kenya, Iraq, Namibia, Kazakhstan, Azerbaijan, Morocco, Serbia and India.
