The Coca-Cola Co. (NYSE:KO) of Atlanta, Georgia in the United States has a worldwide presence. But the business faces strong competition as well from PepsiCo, Inc. (NYSE:PEP) and a string of other local players wherever they operate. Asia with its millions of people have for long been an attractive market.
To expand their production capacities, Coca-Cola just announced the opening of their new $100 million plant in Cambodia. It is located just outside the capital Phnom Penh. With this new plant, the company will now have a stronger presence in the country. The plant is located on a 12-hectare land within a special economic zone that was created to invite both domestic and international businesses.
Cambodian Government is Happy, and Committed
The company will employ 817 people in this new plant, which incidentally is going to be powered fully by solar power. Prime Minister Hun Sen expressed his happiness at the inauguration ceremony held on Monday. We are going to bring more businesses to the PPSEZ (Phnom Penh Special Economic Zone), he said, sounding confident.
He reiterated the government’s commitment to build more infrastructures and train human resources so that they are ready for employment. Hun Sen also wants to supply cheaper electricity for the benefit of businesses in the country.
The zone was opened through a Cambodian-Japanese joint venture. It is currently the largest industrial estate in the country. The Minebea Co (TYO: 6479) of Japan, which makes electronic devices and machinery parts will also be opening a new plant in this special economic zone this week.
Coca-Cola (NYSE:KO) has been operating in Cambodia since 1993. However, Coca Cola’s executive vice president, Irial Finan said they have been looking at every growth opportunity in the region since the last four years. We are going to focus even more in Asia in the future, Irial says.
Cambodian Economy in Good Shape
The Cambodian economy has been on the right track in recent times. Government officials have revealed that 100 new factories have opened in first nine months of the year, employing more than 51,000 people. Though a few small factories have closed down, but the overall growth has been 11 percent over the same period of last year.
Many manufactures are expected to start their factories in Cambodia because of the recent US decision allowing travel goods made in the country to enter the US duty-free.