Phnom Penh

Cambodia COUNTRY

2,129,371 CITY POPULATION

Municipal Council GOVERNMENT TYPE

Introduction

Phnom Penh formerly known as Krong Chaktomuk Serimongkul or shortly known as Krong Chaktomuk is the capital and most populous city in Cambodia. It lies at the confluence of the Basăk , Sab, and Mekong river systems, in the south-central part of the country. Phnom Penh has been the national capital since French colonization of Cambodia, and has grown to become the nation's economic, industrial, and cultural center.

Once known as the «Pearl of Asia,» it was considered one of the loveliest French-built cities in Indochina in the 1920s. Phnom Penh, along with Siem Reap and Sihanoukville, are significant global and domestic tourist destinations for Cambodia. Founded in 1372, the city is noted for its historical architecture and attractions. It became the national capital in 1434 following the fall of Angkor, and remained so until 1497.

It regained its capital status during the French colonial era in 1865. There are a number of surviving French colonial buildings scattered along the grand boulevards. On the banks of the Tonlé Sap, Mekong, and Bassac Rivers, Phnom Penh is home to more than 2 million people, approximately 14% of the Cambodian population.

Data and Facts

For 2016, Phnom Penh ranks as the 118th costliest city for newly relocated citizens, up 24 places from 2015 when Mercer recognized Phnom Penh as the world’s 142nd most expensive city
Population density is many times higher within Cambodia’s capital city with an average 21,900 Phnom Penhers per square mile (8,400 per square kilometer)
Phnom Penh was named after a Buddhist Temple, Wat Phnom. It has stood high atop their city since the 14th Century. Penh was a real person, too–a nun who played a prominent role in the founding of the city
Monsoon season (typically occurring in September and October) can shower Phnom Penh with over 200 inches of rain in a single month
The dry season lasts from December to April; when overnight temperatures can drop to 22 °C (72 °F)

Administration

Phnom Penh is a municipality of area 678.46 square kilometres with a government status equal to that of Cambodian provinces. The municipality is divided into 14 administrative divisions called khans . The sections are subdivided into 105 sangkats , and further subdivided into 953 phums . All khans are under the governance of the Phnom Penh Municipality. Dangkao, Meanchey, Porsenchey, Sen Sok and Russei Keo are considered the outskirts of the city. The municipality is governed by the governor who acts as the top executive of the city as well as overseeing the Municipal Military Police, Municipal Police, and Bureau of Urban Affairs. Below the governor is the first vice governor and five vice governors. The chief of cabinet, who holds the same status as the vice governors, heads the cabinet consisting of eight deputy chiefs of cabinet who in turn are in charge of the 27 administrative departments. Every khan also has a chief.

Economy

Phnom Penh is Cambodia's economic centre as it accounts for a large portion of the Cambodian economy. Double-digit economic growth rates in recent years have triggered an economic boom in Phnom Penh, with new hotels, restaurants, bars, high rises and residential buildings springing up in the city. According to the World Travel and Tourism Council, tourism made up 17.5 percent of Cambodia's GDP in 2009 and accounts for 13.7 percent of total employment. High rise buildings will be constructed at the entrance of the city and near the lakes and riverbanks. Furthermore, new roads, canals, and a railway system will be used to connect Camko City and Phnom Penh.

The economy is based on commercial interests such as garments, trading, and small and medium enterprises. In the past few years the property business has been booming, with rapidly increasing real estate prices. Tourism is also a major contributor in the capital as more shopping and commercial centres open, making Phnom Penh one of the major tourist destinations in the country along with Siem Reap and Sihanoukville. The Bureau of Urban Affairs of Phnom Penh Municipality has plans to expand and construct new infrastructure to accommodate the growing population and economy. High rise buildings will be constructed at the entrance of the city and near the lakes and riverbanks. Furthermore, new roads, canals, and a railway system will be used to connect Camko City and Phnom Penh.

With booming economic growth seen since the 1990s, new shopping venues have opened: Sorya Center Point, Aeon Mall Phnom Penh, Aeon Mall Sen Sok City, Olympia Mall, and Parkson Mall . Many international brands have opened such as Mango, Salvatore Ferragamo, Hugo Boss, Padini Concept Store, Lily, Timberland, Jimmy Choo, CC Double O, MO, Brands Outlet, Nike, Converse, Pony, Armani Exchange, and Super Dry. The tallest skyscraper in Phnom Penh is Vattanac Capital Tower at a height of 188 metres , dominating Phnom Penh's skyline with its neighbour skyscraper Canadia Tower. The tower was topped out in May 2012 and was completed in late-2014.

Business Environment

Over the past few years, Phnom Penh has undergone tremendous changes. Numerous businesses have sprung up and tourism is booming. Cambodia introduced liberal investment laws to attract foreign investors. The number of restaurants and hotels have grown considerably and there had been a huge increase in the number of visitors.

Much of the development that has taken places has been rather haphazard and shoddy. In recent years an effort has been made to control development and preserve the character of historical central area. In the late 1990s, $5 million was spent on improving the storm drains, sewers and street lighting.

To relieve traffic congestion and make the roads safer, city officials in the early 2000s: 1) re-engineered the roads to make them traffic flow more smoothly; 2) embarked on an aggressive campaign to crack down on illegal driving; 3) encouraged more people to take public transportation; urged rickshaw drivers to use the side streets so they didn’t disrupt traffic; and introduced separate lanes for buses, motorbikes, cars and pedestrians so they didn’t interfere with one another. The impact of the effort however was unable to keep pace with influx of vehicles that descended on the city.

Additionally in the early 2000s, Phnom Penh was given a serious sprucing up when it hosted a major ASEAN meeting that was attended by U.S. The Chinese community has grown considerably in recent years. There are now lots of Chinese restaurants and signs in Chinese almost outnumber those in Thai. Though the city is located 120 miles away from the sea, its proximity to the Mekong river valley makes it an ideal port – connecting the landlocked region to the South China Sea via Vietnam by the Hau Giang channel of the Mekong Delta. Phnom Penh is home to 1.5 million people, and serves as a major global and domestic tourist destination in Cambodia. Khmer, the most popular and official language of the country is the main language; English and French are also widely spoken.

Since the end of Cambodia’s civil war in 1975, the city has undergone rapid development in terms of infrastructure. The city has four main national highways and three rail lines that connect it to the main seaport at Sihanoukville . The highways radiates out to other parts of Cambodia and its neighboring countries – Thailand, Vietnam, and Laos.

Phnom Penh International Airport is well connected with popular cities in the region, such as Bangkok and Ho Chi Minh City and regional hubs such as Singapore and Hong Kong. Domestically, too, it is well connected – Phnom Penh has direct and frequent flights to Siem Reap, the main tourist gateway to the ancient Khmer ruins of Angkor Wat, a UNESCO World Heritage site.

Cambodia’s economy has grown remarkably in the past few years, with an annual growth rate averaging more than 7 percent between 2012 and 2016. Some of the key incentives include corporate income tax exemption of up to nine years, exemption from import duty on materials and equipment used in production, investment protection agreements with the world’s leading economies, freedom from price control, as well as free remittance of foreign currency. Besides, export-oriented manufacturers can access preferential treatment under ASEAN’s Free Trade Agreements to explore Asian markets and increase competitiveness.

Since foreign nationals cannot own land in Cambodia, SEZs offer them an opportunity to develop, or sub-lease plots with up to 50 years of renewable leases. This gives businesses more flexibility in organizing their factory activities over a long period of time.

Phnom Penh’s is the country’s economic center, accounting for a large share of the Cambodian economy. The city, along with its neighboring provinces, serve as the most industrially developed area in the country – in terms of labor force and infrastructure. Phnom Penh specializes in light labor-intensive industries such as garments and footwear, food and beverage, and consumer products.

The Phnom Penh Special Economic Zone , established in 2006, holds the key to the city’s economic growth and development. The SEZ is strategically located between Bangkok and Ho Chi Minh City at the center of the East-West Economic Corridor that links Cambodia, Vietnam, Thailand, and Myanmar. The economic zone serves as a manufacturing hub for over 77 export-oriented companies that produce a diverse range of products. These include companies manufacturing mechanical and electrical products, garments and shoes, pharmaceutical products, consumer products, as well as pharmaceutical, packaging, and logistics companies.

Over the years, with the opening up of its economy and a stable political environment, several other industries have mushroomed in Phnom Penh. A number of shopping centers, hotels, and commercial centers have opened up, making real estate a lucrative business in the city.

Infrastructure

Phnom Penh International Airport is the largest and busiest airport in Cambodia. It is seven kilometres west of central Phnom Penh. The airport is connected to the city center by taxi, train, and shuttle bus.Cambodia's national flag carrier, Cambodia Angkor Air, launched in 2009, is headquartered in Phnom Penh and has its main hub there, with an additional hub at the Angkor International Airport. Air France used to serve Phnom Penh from Paris-Charles de Gaulle but this service has since stopped. Qatar Airways now flies to and from Phnom Penh, via Ho Chi Minh City. There are numerous bus companies, including Phnom Penh Public Transport and GST Express, running services to most provincial capitals, including Sihanoukville, Kampong Chhnang, Oudong and Takéo. Phnom Penh Sorya Transport Co. offers bus service to several provincial destinations along the National Routes and to Ho Chi Minh City. Giant Ibis is another bus company based in Phnom Penh, which travels to Sihanoukville, Kampot, Siem Reap and Ho Chi Minh, and has free Wi-Fi, air conditioning and modest pricing.

The city is Cambodia's main freshwater port, a major port on the Mekong River. It is linked to the South China Sea, 290 kilometres distant, via a channel of the Mekong in Vietnam. Phnom Penh is served by three air conditioned bus lines. The city is now served by three bus lines, operated by the Phnom Penh municipal government. Private transportation within the city include the cycle rickshaw, known in Khmer as “cyclo”, the motorcycle taxi known in Khmer as «moto», the auto rickshaw known locally as “tuk-tuk”, the trailer attached to a motorcycle taxi known in Khmer as «remorque», and the standard automobile taxicab known in Khmer as “taxi”. Private forms of transportation used by locals include bicycles, motorbikes, and cars. Water supply in Phnom Penh has improved dramatically in terms of access, service quality, efficiency, cost recovery and governance between 1993 and 2006. The number of customers has increased ninefold, service quality has improved from intermittent to continuous supply, water losses have been cut dramatically and the city's water utility went from being bankrupt to making a modest profit. These achievements were recognized through international awards such as the 2006 Ramon Magsaysay Award and the 2010 Stockholm Industry Water Award.

Technology

Cambodia is pursuing its transformation from a post-conflict state into a market economy. Growth averaged 6.4% per year between 2007 and 2012 and the poverty rate shrank from 48% to 19% of the population, according to the Asian Development Bank's Country Partnership Strategy 2014–2018.Cambodia exports mainly garments and products from agriculture and fisheries but is striving to diversify the economy. There is some evidence of expansion in value-added exports from a low starting point, largely thanks to the manufacture of electrical goods and telecommunications by foreign multinationals implanted in the country. Between 2008 and 2013, high-tech exports climbed from just US$3.8million to US$76.5 million.In 2014, the country adopted its Cambodia Vision 2030, which aims to turn Cambodia into an upper-middle economy by 2030. In 2015, it adopted its Industrial Development Policy 2015–2025.Cambodia is a member of the Association of Southeast Asian Nations , which formed a common market in late 2015 called the ASEAN Economic Community. The planned removal of restrictions on the cross-border movement of people and services is expected to spur cooperation in science and technology. The greater mobility of skilled personnel should be a boon for the region and enhance the role of the ASEAN University Network, which counted 30 members in 2016, including the Royal University of Phnom Penh.International and civil wars decimated Cambodia's scientific capacity in the 1970s. More recently, Cambodia has been held back by the limited co-ordination of science and technology across ministries and the absence of any overarching national strategy for science and development. A National Committee for Science and Technology representing 11 ministries has been in place since 1999. Although seven ministries are responsible for the country's 33 public universities, the majority of these institutions come under the umbrella of the Ministry of Education, Youth and Support.In 2010, the Ministry of Education, Youth and Support approved a Policy on Research Development in the Education Sector. This move represented a first step towards a national approach to research and development across the university sector and the application of research for the purposes of national development.This policy was followed by the country's first National Science and Technology Master Plan 2014–2020. It was officially launched by the Ministry of Planning in December 2014, as the culmination of a two-year process supported by the Korea International Cooperation Agency. The plan makes provision for establishing a science and technology foundation to promote industrial innovation, with a particular focus on agriculture, primary industry and ICTs.The large foreign firms in Cambodia that are the main source of value-added exports tend to specialize in electrical machinery and télécommunications. The principal task for science and technology policy will be to facilitate spillovers from these large operators towards smaller firms and across other sectors like agriculture, in order to strengthen the technical capacity of these smaller firms.There is little evidence that the Law on Patents, Utility Model Certificates and Industrial Designs has been of practical use, thus far, to any but the larger foreign firms operating in Cambodia. One strategic policy issue will be how to align NGO research support on national strategic plans for development.

The Internet penetration in Cambodia has increased rapidly . From small businesses to large organisations, the backbone of their daily operation demands fast, yet reliable Internet connection.In January 2017, a new startup accelerator and incubator will be opened in the heart of Phnom Penh. Trybe is going to be a place where people make, do, and share. A maker-space, a co-working space, startup focal point all in one. With these startup communities continue grow like mushrooms in rainy season, Phnom Penh is becoming a charming city of startups. A more premium class work space is just a few walks away from Wat Phnom: Rain Tree Development. «Nurturing entrepreneur spirits falls within our core values. We’ve been working with Impact Hub and Tekhub since the beginning,» Vireak Ouk, SINET’s Chief Operating Officer, told me recently.Cambodian tech startups don’t, at this point in time, really have the kind of support from the government like in Singapore or even Thailand and Vietnam. The main challenge facing the startup people here is: to change the mindset of the users . For example, even a successful startup that can build the best tech platform with a lot of payment methods, local customers are not willing to take the risk.

But more could be done to bring Southeast Asia’s tech boom to Cambodia. Both established IT firms and tech startups would benefit from more foreign direct investment, more foreign venture capital, and closer ties with regional tech hubs.

Drawing the big tech firms to Cambodia would help Cambodian startups solve the complex programming and engineering challenges they face in bringing products to market. To make these things happen, the government, private sector, and Cambodia’s international partners need to work together. Based on my 30 years of experience in economic development, I see four important jobs ahead. Cambodia’s tech scene is built on a couple of key strengths. Information technology programmes in Cambodian universities are improving in quality and are producing better trained graduates every year. More than two dozen co-working spaces, incubators, and innovation labs are providing critical early support to tech entrepreneurs. Singapore is a centre for venture capital and, increasingly, artificial intelligence. Indonesia is a major player in the e-marketplace and service sector.

There is no reason why Cambodia could not become a leader in its own niche – but identifying that niche and tailoring specific support for it will require close cooperation between Cambodia’s private sector and the government. Uber’s launch in Phnom Penh last month shows the impact of effective government-industry cooperation. Uber is the world’s most valuable tech startup but has had growing pains in many markets. Thanks to strong cooperation with the Ministry of Public Works and Transport, Cambodia now has the most forward-thinking regulatory framework for ridesharing in Asia. This framework should lead to strong growth in Cambodia’s ridesharing market as Uber’s competitors also look at the market.

Technology is different than manufacturing, construction and other traditional economic sectors. The capital requirements for startups are much lower, especially at the beginning. Tech entrepreneurs tend to be young, creative, collaborative, and very international.The lesson of Silicon Valley and other technology centres is that the best way to grow a dynamic tech sector is to send a clear signal that startups and tech entrepreneurs are welcome, focus government efforts on strengthening the indirect building blocks for the sector, and to let the creative process develop on its own. After Singapore, Cambodia already has the most welcoming business environment in the region. And the startup sector doesn’t need direct financial support from the government at this time. But the government could send a welcoming signal to international investors if it consulted with the tech industry and announced a targeted programme to support startups and the tech sector. This programme could be structured along the lines of Thailand’s «Thailand 4.0» programme or Vietnam’s «Vietnam Silicon Valley» initiative. For the next few years, Cambodia’s tech sector and market for new technologies may be too small to draw in the largest tech companies.

Social Wellness and Human Resources

As of 2019, Phnom Penh had a population of 2,129,371 people, with a total population density of 3,136 inhabitants per square kilometre in a 679 square kilometres city area. The population growth rate of the city is 3.92%. The city area has grown fourfold since 1979, and the metro area will continue to expand in order to support the city's growing population and economy.

Phnom Penh is mostly inhabited by Cambodians . They represent 90% of the population of the city. More than 90% of the people in Phnom Penh are Buddhists. Chams have been practicing Islam for hundreds of years. Since 1993, there has also been an increase in the practice of Christianity which was practically wiped out after 1975 when the Khmer Rouge took over. The official language is Khmer, but English and French are widely used in the city. The number of slum-inhabitants at the end of 2012 was 105,771, compared with 85,807 at the start of 2012.

Phnom Penh also has its own dialect of Khmer. Phnom Penh is also known for its influence on New Khmer Architecture. Phnom Penh is notable for Ka tieu Phnom Penh, its variation on rice noodle soup, a dish available in sit-down cafes as well as street cafes. Music and the arts are making a revival throughout Cambodia, especially in Phnom Penh. Phnom Penh currently hosts a number of music events throughout the city. 'Indie' bands have grown in number due also in part to the emergence of private music schools such as SoundsKool Music , and Music Arts School. The two most visited museums in the city are the National Museum, which is the country's leading historical and archaeological museum, and Tuol Sleng Genocide Museum, a former Khmer Rouge prison.