Not all is well in the Kingdom of Hun.
Hun Manet, Cambodia’s new prime minister, who inherited the role from his father in August, prepares to meet with the business community on November 13 at the much-anticipated Government-Private Sector Forum. The government has been parlaying with business groups for months. But anger is brewing. The public is still angsty over possible tax rises. Hun Manet has denied that there will be any, but anyone who looks at his government’s Panglossian Pentagonal Strategy (an advanced economy by 2050!) knows that more tax is coming, as I argued here last month. I hear that a coterie of chambers of commerce has united to demand new reforms and guarantees from Hun Manet at the upcoming forum.
Most likely, though, proceedings will be dominated by talk about the imposing property market and the encroaching disaster of private debt. Put simply, tens of billions of dollars of Chinese money poured into Cambodia in the 2010s, leading to a housing bubble and rampant speculation, primarily from Cambodia’s middle classes, who thought that Chinese funds and soaring prices would never dry up. Loans and mortgages were taken to purchase land and homes. But the COVID-19 pandemic and a drop off in private Chinese investment have resulted in falling property prices.