Overview and Outlook of the Frontier Countries Toward ASEAN Economic Community in 2015

10/14/2014 1 •Phnom Penh Special Economic Zone - Strictly Confidential

ESRI Conference

SARAN Sopha (Ms.) Customer Service Manager Phnom Penh SEZ Co., Ltd.

26 September 2014

Content

1. General Information of SEZ in Cambodia

2. Phnom Penh Special Economic Zone

3. PPSEZ’s Preparation for AEC

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Why invest in Cambodia?

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Advantages for Japanese investors

• Investment incentives provided under Cambodian investment law and regulations

• Assurance of equal treatment on national and foreign investment

• Preferential access of Cambodian-made products to the world’s markets

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Commitment of Cambodian Government to SEZ

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Council for the Development of Cambodia (CDC) (Chairman - Prime Minister HUN SEN)

Sub-decree on SEZ was issued on December 2005

Cambodian SEZ Board (CSEZB)

The SEZ Administration One Stop Service Center

SEZ1 OSS1

SEZ2 OSS2

SEZ3 OSS3 ・・・・・

SEZ Trouble Shooting Committee (Chaired by Prime Minister HUN SEN)

Solution

Prime Minister HUN SEN directly attend to solve issues happened in SEZ

Phnom Penh Special Economic Zone - Strictly Confidential

Incentives for Investors (1)

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Tax Incentives for Qualified Investment Project, QIP

Profit tax exemption “Trigger Period” ＋ 3 years ＋ Priority Period

Maximum Trigger Period: To be the first year of profit or 3 years after the QIP earns its first revenue, whichever sooner

Import duty exemption on construction materials and production equipment

Import duty exemption on production materials for export industry and export duty exemption

Phnom Penh Special Economic Zone - Strictly Confidential

Incentives for Investment (2)

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Other Benefits Equal market access for foreign investors

50 year lease of land available to foreign investor (renewable and transferable)

Unrestricted currency exchange and fund transfer

Tax Incentive for QIP-SEZ Investor Exemption of 10% VAT in addition to import duty exemption

Type of QIP Construction Material

Production Equipment

Production Material

Export Industry Exempted Exempted Exempted

Domestic Industry Exempted Exempted Not Exempted

Phnom Penh Special Economic Zone - Strictly Confidential

Phnom Penh Special Economic Zone

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Major SEZs in Cambodia

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No. Name Location Establishment Year

Investors number

Investors Investment

Amount

1 Phnom Penh SEZ Phnom Penh 2006 66 353M

2 Manhattan SEZ Svay Rieng Province 2006 30 193M

3 Tai Seng Bavet SEZ Svay Rieng Province 2007 23 103M

4 Sihanouk Ville SEZ Sihanoukville Province 2008 33 85M

5 Neang Kok Koh Kong SEZ Koh Kong Province 2007 6 79M

6 Goldfame Pak Shun SEZ Kandal Province 2007 3 27M

7 Sihanoukville Port SEZ Sihanoukville Province 2009 2 21M

8 Dragon King SEZ Svay Rieng Province 2012 2 8M

9 Poi Pet O'Neang SEZ Banteay Meanchey Province 2006 6 7M

Phnom Penh Special Economic Zone - Strictly Confidential

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COMPANY NATIONALITY INDUSTRY TYPE STATUS

1 Tiger Wing Japan Lady shoes Export Started operation in August 2008

2 Cambodian Success Industry

Malaysia Wire mesh Domestic Started operation in November 2008

3 Evergreen Industrial Taiwan/ Cambodia

Garment (Jeans)

Export Started operation in January 2009

4 Ji-Xiang Taiwan Carton box Supporting Started operation in April 2009

5 Cambox Singapore Plastic container

Domestic Started operation in June 2009

6 Yi Xiang Taiwan Hanger Supporting Start operation in March 2010

7 Clean Circle Japan Lady shoes Export Started operation in March 2010

8 Sin Chn Hong Plastics Industry

Taiwan Shoe sole Supporting Started operation in April 2010

9 Ajinomoto Cambodia Japan Food processing

Domestic Started operation in October 2010

As of February 2014 in progress order Manufacturers in PPSEZ (1)

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COMPANY NATIONALITY INDUSTRY TYPE STATUS

10 Haru Phnom Penh Comic Center

Japan Comic reuse, E-comic

Export Started operation in November 2010

11 Shin Feng Paper Taiwan Carton box Supporting Started operation in January 2011

12 Atlas Ice Malaysia Ice Domestic Started operation in January 2011

13 Minebea Japan Small size motor Export Started operation in April 2011

14 Proceeding Phnom Penh

Japan (Hong Kong)

Garment (Kimono)

Export Started operation in April 2011

15 Redian Industrial Korea Plastic package Supporting Started operation in April 2011

16 Fukuju Japan Garment (Kimono)

Export Started operation in June 2011

17 Dishells Cambodia Japan Heat insulation paint and products

Export Started operation in July 2011

Manufacturers in PPSEZ (2)

Phnom Penh Special Economic Zone - Strictly Confidential

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COMPANY NATIONALITY INDUSTRY TYPE STATUS

18 Sichuan New Hope Agribusiness Cambodia

China/Japan Animal feed Domestic Started operation in July 2011

19 Combi Cambodia Japan (Hong Kong)

Baby carrier Export Started operation in July 2011

20 O & M Cambodia Japan Leather product Export Started operation in January 2012

21 Marunix Cambodia Japan (Hong Kong)

Wire harness Export Started operation in February 2012

22 Kyowaseikan Cambodia

Japan Box and packaging

Export Started operation in February 2012

23 Sunhsin Thread and String Cambodia

China Tread and string Supporting Started operation in February 2012

24 Zion Label and Printing

Singapore/ China

Apparel label Supporting Started operation in February 2012

25 Sumi Cambodia Wiring Systems

Japan Wire harness for automobile

Export Started operation in April 2012

Manufacturers in PPSEZ (3)

Phnom Penh Special Economic Zone - Strictly Confidential

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COMPANY NATIONALITY INDUSTRY TYPE STATUS

26 Soon-West Cambodia Japan/Korea Earphone for mobile phone

Export Started operation in April 2012

27 Japan Rocks S.E.A. Phnom Penh

Japan Lady wear Export Started operation in July 2012

28 Jai Long Plastic Products

China Plastic package Supporting Started operation in July 2012

29 Fontz Power Japan Fashion bag Export Started operation in August 2012

30 Mega Labels & Stickers Cambodia

Malaysia Label & sticker Export Started operation in August 2012

31 Weibo Best production Cambodia

Turkey/China Garment Export Started operation in September 2012

32 Weibo EIC Garment Manufacturing Cambodia

Turkey/ China Garment Export Started operation in September 2012

33 Liwayway Cambodia Food Industry

Philippines Snack Food Domestic Started operation in November 2012

Phnom Penh Special Economic Zone - Strictly Confidential

Manufacturers in PPSEZ (4)

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COMPANY NATIONALITY INDUSTRY TYPE STATUS

34 Yamato Konpo Unyu Cambodia

Japan Packaging Supporting Operation to start in December 2012

35 Keza Cambodia Malaysia Elastic band Export Started operation in December 2012

36 Footmark Cambodia Japan garment Export Started operation in February 2013

37 GS Electech Cambodia

Japan Wireharness Export Started Operation in July 2013

38 DENSO Cambodia Japan (Singapore)

Automobile parts

Export Started Operation in July 2013

39 Taiwa Seiki Cambodia Japan Rice-polish machine

Domestic Started Operation in August 2013

40 Lecien Cambodia Japan Lady underwear Export Started Operation in October 2013

41 Marusan Phnom Penh Plastic

Japan Automobile parts

Export Started Operation in October 2013

42 Tanaka Foresight Cambodia

Japan Optical parts for eyeglasses

Export Started Operation in November 2013

Manufacturers in PPSEZ (5)

Phnom Penh Special Economic Zone - Strictly Confidential

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COMPANY NATIONALITY INDUSTRY TYPE STATUS

43 Taica Cambodia Japan Shock absorber for shoes

Export Started Operation in November 2013

44 Maru-T Ohtsuka Phnom Penh

Japan Painting tools Export Started Operation in November 2013

45 Asia Bioagri Technology

Singapore Fertiliser Domestic Started Operation in December 2013

46 Thibidi Cambodia Vietnam Transformer Domestic Operation to be started

47

Taiyo Kogyo Japan Flexible container bag

Export Operation to be started

48

Nikko-Kinzoku Cambodia

Japan Lost-wax casting Export Operation to be started

49

Phnom Penh Combi Japan Baby goods & toys

Export Operation to be started

50 Stratco Cambodia Australia Metal building materials

Export Operation to be started

51 Kannax Phnom Penh Japan (Singapore)

Fabric and leather products

Export Operation to be started

Manufacturers in PPSEZ (6)

Phnom Penh Special Economic Zone - Strictly Confidential

COMPANY NATIONALITY INDUSTRY TYPE STATUS

52 Meikodo Cambodia

Japan Pin Export Factory construction on going

53 Laurelton Diamond

USA Diamond polish Export Factory construction on going

54 CH Steel Wire Industries Cambodia

Malaysia Wire mesh Domestic Factory construction on going

55 Betagro Cambodia Thailand Animal feed Domestic Factory construction on going

56 Eurostar Diamonds Cambodia

Belgium Diamond polish Domestic Factory construction on going

57 Shinih Taiwan Non-woven fabric

Export Factory construction on going

58 Rohto-Mentholatum

Japan Eye drop Domestic Factory construction on going

59 Angkor Dairy Products

Vietnam/ Cambodia

Dairy products Domestic Preparing factory construction 16

Manufacturers in PPSEZ (7)

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Manufacturers in PPSEZ (8) COMPANY NATIONALITY INDUSTRY TYPE STATUS

60 Yamaha Motor Cambodia

Japan Motor bike assembly

Domestic Preparing factory construction

61 Medipro Cambodia

Japan Medical garment Export Preparing factory construction

62 YHS(Cambodia) Food & Beverage

Singapore Food & beverage Export/ Domestic

Investment application in process

63 Printe Cambodia Japan Electrical Parts Export Investment application in preparation

64 Artnature Japan Hair piece Export Investment application in preparation

65 Heiko Cambodia Japan Packaging Products

Export/ Domestic

Investment application in preparation

66 Printe Cambodia Japan Electrical Parts Export Investment application in process

67 Take off Cambodia Japan Stuffed Animals Export Investment application in process

Phnom Penh Special Economic Zone - Strictly Confidential

Company Profile

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Company Name: Phnom Penh SEZ Co., Ltd.

Incorporation: 19 April, 2006 under Sub-decree No. 33 by the Royal Government of Cambodia

Capital: 13million US dollars

Shareholders: Lok Chumteav Oknha Lim Chhiv Ho 78% Zephyr Co., Ltd. (Tokyo, Japan) 22%

Board of Directors: Lok Chumteav Oknha Lim Chhiv Ho

TAN Kak Khun / Eric (Mr.)

Hiroshi UEMATSU (Mr.)

as Chairwoman of the Board

TAN Soeun Muoy / Janice (Ms.) Phnom Penh Special Economic Zone - Strictly Confidential

Strategic Location for Investment (1)

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Phnom Penh SEZ

Phnom Penh International Airport

Phnom Penh City Center 10 km / 30 min

8km / 15 min

Phnom Penh Special Economic Zone - Strictly Confidential

Strategic Location for Investment (2)

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PPSEZ

Sihanoukville Port

Phnom Penh International Air Port

Phnom Penh Port

212 km

Phnom Penh Special Economic Zone - Strictly Confidential

Strategic Location for Investment (3)

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South East-West Corridor 228km

660km

Phnom Penh Special Economic Zone - Strictly Confidential

4. INTRODUCTION OF PPSEZ

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Management Team:

FONG Nee Wai (Mr.), Chief Finance Officer

Staff Number: 63 Organizational Structure:

Hiroshi UEMATSU (Mr.), Chief Executive Officer

PHOU Muoy Buoy/Carie (Ms.), Disclosure Director/Corp Secretary

Board of Directors

MD CFO

Admin. & Accounting

Dept.

Public Relations

Dept.

Operation Dept.

COO

Current Condition of Infrastructure

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Phase 1 (141ha): Infrastructure work was completed in April 2008, and are being operated every day.

Phase 2 (162ha): Started work from January 2011

Sewage Treatment Plant

Water Purification

Plant

Dry Port

Phase 1 ： 141ha （Industrial Area：58 plots）

Phase 2：162ha （Industrial Area：91plots）

Phase 3 ： 57ha （Residential Area）

Commercial Area

Industrial Area

Independent Power Plant

PPSEZ Total Area ＝360ha

Phnom Penh Special Economic Zone - Strictly Confidential

Independent Power Plant

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Capacity : 13MW/h (Phase 1 only, expandable according to the demand）

Fuel : Heavy Oil

PPSEZ runs independent power plant by establishing Colben Energy (Cambodia) PPSEZ Ltd. with a Singaporean company. (http://www.colbenenergy.com)

Phnom Penh Special Economic Zone - Strictly Confidential

Water Purification/ Sewage Treatment Plant

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1)Adjoining River - 2)Raw Water Reservoir - 3)Chemical Treatment - 4)Filtering - 5)Water Towers

1)Waste Water (Primary Treatment by Factories) - 2)Primary Pond - 3)Lagoon - 4)Settling Pond - 5)Final Pond - 6)Discharge to Public River

Capacity : 5,300m3/day for phase 1

Capacity : 4,500m3/day for phase 1

Phnom Penh Special Economic Zone - Strictly Confidential

26

PPSEZ establishes Bok Seng PPSEZ Dryport Ltd with a Singaporean company for Logistics Center in order to facilitate import / export transactions of our customers. (http://www.bsgroup.com.sg)

Dryport

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International Corporations

Chinese biggest agribusiness group

Philippine major snack food company

Manufacturers in PPSEZ (9)

Thai major food processing company

Phnom Penh Special Economic Zone - Strictly Confidential

PPSEZ’s Preparation for AEC

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PPSEZ’s Preparation for AEC (1)

Challenge for reforms by focusing on export and investment facilitation through strengthening of:

1. Good governance Anti-corruption stand

2. Infrastructure development Maintain good infrastructure within the zone

3. Human resources development Establishment of Vocational Training School

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Thank you for your attention!

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Ms. SARAN Sopha E-mail: ssopha@ppsez.com