The government’s top industry official pledged Friday to push for ratification of a multilateral investment treaty that has been languishing in the National Assembly for more than three years.
Finalizing an agreement to join the Multilateral Investment Guarantee Agency would help make Cambodia attractive to foreign investment, said Suy Sem, the minister of Industry, Mines and Energy.
Cambodia signed agreements to join the MIGA in 1995, but the documents are awaiting ratification by the National Assembly.
The MIGA was created in 1988 as the newest member of the World Bank Group in order to encourage foreign investment in developing countries.
The agency offers investment guarantees in any member country against risks of currency inconvertibility, government seizure of investments, war and civil unrest and breach of contract by the host government.
Failure to ratify the agreement has already cost Cambodia, said Lorin Weisenfeld, principal counsel at the agency.
Negotiations last summer with Nippon Telegraph and Telecom broke down partially because there was no coverage for political losses.
“Cambodia has to hurry up because Cambodia is in competition with its neighboring states for investment,” Weisenfeld said.
The 145-member MIGA includes most of the region.
Cambodia has entered into six bilateral treaties for protection of foreign investment, only two of which—with Malaysia and Thailand—have been ratified.
The government has signed agreements with Singapore, Switzerland, South Korea and China, said Sok Siphana, former legal adviser to the Council for the Development of Cambodia.
The government also signed and ratified the Overseas Private Investment Corporation agreement with the US in 1997 that provides long-term financing and risk insurance for US investors overseas.