Cambodia to let foreirgners to own property

PHNOM PENH, March 25 — Cambodia’s Parliament is to debate a law next month that would allow foreigners to own property directly, one of the aims being to attract more investors to the Southeast Asian country.

Until now, foreigners wanting to buy property have had to do it through a Cambodian representative.

“This is a really good thing, because all these modern apartments, the Cambodians don’t have money to buy them,” said Nun Pheany, spokeswoman for the Land Management Ministry. “For condominiums, this is an encouragement to investors.”

Neighbouring countries including Vietnam had passed similar laws, so it was time Cambodia did, she said. “We want to have contact with big investors, to make them feel warm in Cambodia.”

The National Assembly will begin debating the legislation on April 1. It would allow foreigners to own apartments above the ground floor in buildings 30km from the country’s borders. Foreigners will only be able to buy a maximum 49 per cent of any building.

“This law has been sought by the private sector. We’ve wanted it for quite some time,” said Sung Bonna, chief executive of Bonna Realty Group and president of the National Valuers Association.

“This will encourage foreigners, investors to help the recovery. The real estate and construction sectors have been weak,” Sung Bonna said.

Heng Sakara, a manager at All Plan International, developer of the US$55 million (RM187 million) River Palace 31 in Phnom Penh, said the law could attract huge numbers of foreigners to the country.

“Diplomats and investors, most of them want to buy units, apartments for their personal property. Cambodians couldn’t afford to buy all of them,” Heng Sakara said, adding it was good news for his 31-storey project, suspended due to the economic slump.

Cambodia’s economy enjoyed several years of double-digit growth before tourism and the garment sector took a hit from the global economic crisis. The economy probably shrank in 2009.

Sung Bonna said Cambodia’s real estate and construction sectors were hit hard in 2008 and 2009 and forecast that this year would be only a little better.

Output in the construction sector slumped 42 per cent in 2009 to US$1.7 billion, ministry spokeswoman Nun Pheany said. She did not yet have data for 2010. — Reuters