July 2, 2012
Reposted from the Phnom Penh Post
By May Kunmakara and Gregory Pellechi
Prudential plc, a financial-services company from the United Kingdom, planned to invest US$7 million in Cambodia’s insurance industry, British ambassador Mark Gooding told Cambodia’s Minister of Economy and Finance Keat Chhon during a meeting on Friday.
Prudential, not to be confused with the Prudential Insurance Company of America, will open an office in the Kingdom but the ambassador could not confirm the services to be offered, or a time frame for the launch.
Insiders encouraged Prudential’s move into the Cambodian marketplace, saying it would be a very good thing as more data would become available, enabling more accurate risk assessments and risk management.
“It will provide investors with access to the Cambodian market and increase the amount of market research available for Cambodia,” said Chairman of the British Business Association of Cambodia (BBAC) Darren Conquest.
Recently, the government approved two life insurance companies – Cambodia Life Insurance which is a joint-venture between the government and foreign investors, and Manulife from Canada which opened last Thursday.
Gooding said the British Embassy in Cambodia is preparing an exchange visit between Cambodia’s insurance regulators and the UK’s, in order to share experiences between both regulators and to support and encourage investors to come to Cambodia.
Cambodia has six general insurance companies, which generate premiums of about $9.4 million, a year-on-year average increase of 39 per cent in the first quarter of the year.
Chhay Ratanak, chairman of the General Insurance Association of Cambodia (GIAC), said that while neither of the two life insurance companies currently operating in Cambodia are members of the GIAC, the association would hold a meeting this week with the companies to discuss their inclusion in the organisation.
Ratanak said, “I think compared to ASEAN countries there are not many companies” that provide insurance services or life insurance. He made no comment as to whether Cambodia would see more growth in the sector.
He said that there has been a definite increase in the number of insurance companies operating in Cambodia but said that before any more choose to enter the Kingdom they need to proper research the market to ensure that the market can handle another.
The UK Trade and Investment Office re-opened in Cambodia on May 18 in a bid to boost trade and investment between the two countries.
According to the data from the Council for the Development of Cambodia, approved investment from the UK stood as number one in terms of Foreign Direct Investment in Cambodia, last year reaching more than $2 billion.
Prudential is an international financial services group with significant operations in Asia, the US and the UK, and is listed on the London, Hong Kong, Singapore and New York stock exchanges, according to its website, and serves more than 26 million customers and has £351 billion (US$550 billion) of assets under management.
Keat Chhon said Cambodia’s government supported and encouraged all foreign investors, including those from the UK, “to ensure foreign investors continue to enter Cambodia”.
“The government is focusing on the establishment of the anti-corruption law in an effort to eliminate unnecessary expanses, which can adversely affect investment.”
Photo Credit: The Phnom Penh Post via AFP