Industrial Development Plan 2015-2025 (IDP) [KHMER Version] is a guide to promote the country’s industrial development that will help maintain sustainable and inclusive high economic growth through economic diversification, strengthening competitiveness and promoting productivity. The IDP is to embark on a “new growth strategy” that responds to the structural transformation of domestic economy and the changing regional and global economic architecture. The adoption of this policy is motivated by the following considerations:

First, the favorable geopolitical spillovers in terms of linking Cambodian economy and its industry to the region especially within the ASEAN Economic Community and regional economic liberalization frameworks;

Second, the potential role of industrial sector in promoting growth and creating new jobs in the context of an open economy, a demographic dividend and major structural changes that are conducive for industrial growth;

Third, the critical role of industrial sector as a policy tool to enhance the performance of core economic sectors, like agriculture and services, that will further contribute to boosting economic growth; and

Fourth, the importance of the industrial sector as a focus for initiating both structural reforms and governance reforms of key national economic institutions with the aim at boosting economic productivity in long term and avoiding falling into the “middle income trap”.

The RGC’s vision is to transform and modernize Cambodia’s industrial structure from a labor-intensive industry to a skill-driven industry by 2025, through connecting to regional and global value chain; integrating into regional production networks and developing interconnected production clusters along with efforts to strengthen competitiveness and enhance productivity of domestic industries; and moving toward developing a technology-driven and knowledge-based modern industry. The realization of this vision will contribute to national economic development, sustainable and inclusive high economic growth, employment creation, increased valued added to the economy and increased income for the Cambodian people.

To realize the vision of IDP, the RGC has set three targets: First, to increase the GDP share of industrial sector to 30% by 2025 (24.1% of GDP in 2013) with the manufacturing sector growing from 15.5% in 2013 to 20% in 2025; Second, to diversify the export of goods by increasing the export of non-textile to reach 15% of all exports by 2025 while still promoting the export of processed agricultural products to reach 12% of all exports by 2025; and Third, to encourage the formal registration of 80% of small enterprises and 95% of medium enterprises and to ensure that 50% of small enterprises and 70% medium enterprises to have proper accounts and balance sheets.