Cambodia has seen an increase in food manufacturing, mainly beverage factories, which are the most stable, dominant, and advanced.
However, processing factories remain limited, leading to reliance on imports from neighboring countries.
This results in most money flowing out of Cambodia. For example, Vietnam benefits from Cambodia’s limited industrial capacity and low raw-material costs, processing them into final products under its own brands. The lack of factories also harms locals. Farmers must export products at lower prices, and many migrate abroad for food-processing jobs that Cambodia lacks.
The Shortages of Industrial Markets
Although Cambodia has manufacturing facilities, they are limited, and most are small, family-run businesses or small and medium-sized enterprises (SMEs).
Most big companies or enterprises produce beverages or snacks, not staple foods, such as canned fish, canned vegetables, or ready-to-eat meals, while smaller ones usually produce precooked side dishes or spices.
Based on a research paper by iDE Global, when starting new businesses, entrepreneurs would have to take in consideration the price for technicians, electricity cost, and machines that are mostly imported in from other countries, which becomes a problem when the machines need maintenance because of the lack of skilled technicians and the lack of manpower skilled in the food processing area.
Due to the limited technology, Cambodia’s agro-processing lags behind Vietnam and Thailand, leading to Cambodia exporting its raw materials to Vietnam and Thailand to process them and buying back the final product.
The Impact of Brain Drain on Recruitment
The field of agro processing is not well known among young people due to a lack of promotion. Few professionals in the field have shared their experiences and views on how this career path works and how it can contribute to the country's development; hence, only a small number of young people are paying attention to this field. On top of that, this field offers lower salaries than other professions, which is an issue in today’s competitive world. Moreover, the high pay at foreign companies would be more attractive than the low pay in Cambodia.
Based on an article by IPS, a food processor in Cambodia gets paid an average wage of $509, comparatively low to countries such as Singapore, which pays their processors or engineers an average wage of $5,800, one of the highest pays in this field in ASEAN, reported by JOOBLE.
This big difference leads to reconsideration of whether they should still be based in Cambodia or start their journey on this path, in turn leading to a shortage of professional workers in the field in Cambodia. This adds to the reasons why Cambodia lacks manufacturing factories and enterprises, as companies cannot operate without workers, especially in the food processing sector.
Dependency On Foreign Products
Due to a lack of processing factories, Cambodia has been importing raw materials such as cashews, soybeans, rice and fruit from neighboring countries like Vietnam, Thailand, and even Singapore, and exporting fruit, vegetables and processed food. From January to November 2024, trade between Cambodia and Vietnam reached $7 billion, making Vietnam Cambodia’s second-largest export market behind the United States.
However, Vietnam’s main exports to Cambodia, worth $3.79 billion, include building supplies, machinery, fuel, electronics and electrical equipment, fertilisers, animal feed, vegetables and fruit, as reported by the article “Cambodia struggles to harvest its agricultural potential while Vietnam reaps the benefits”.
According to Khmer Times, Keo Mom, CEO of Lyly Food Industry, said, “I have observed that in the past, Cambodia has spent hundreds of millions of dollars every day importing agricultural products, vegetables, fruits, and processed foods from abroad. If we process these products domestically, that money will instead remain in the hands of Cambodian people, helping our economy to grow faster through various forms of processing.”
This issue also came to light recently regarding the border issues with Thailand. Cambodia faced a localized food shortage for a short period after tensions rose. This shows that Cambodia still depends heavily on imported goods even though it has the materials to process them itself. According to an article by East Asia Forum, Cambodia faces challenges in job creation and industrial development, and food processing and packaging remain underexploited fields.
Encourage Investment and Development
More activities, such as workshops or events, are needed that allow professionals and students to learn, share findings, and promote the food processing sector. This attracts human resources and investors. Cambodia lacks human capital in the sector, but a limited job market, tight labor, and low incomes hinder growth. Action is needed
According to ADB, Cambodia exports most of its raw materials, with only 10 percent processed domestically. This leads to limited processing factories, resulting in a lack of jobs in the market. Campaigns to share projects, findings, and knowledge should be held more often for researchers and newcomers to establish connections with seniors and develop the field.
The Special Economic Zones (SEZ) could also step up to hold events or bring in more investors through promotions of the kingdom’s goods and abilities. Companies and enterprises should also contribute by developing and upgrading their products.
Prime Minister Hun Manet at the National Assembly Palace back in 2025 said the government has advanced establishment plans for Agro-Industrial Parks in Kampong Thom, Battambang and Kampong Speu provinces to attract investment in agricultural processing for export, and preparation for establishing cashew nut processing in Kampong Thom province is coming as all of these are a part of the kingdom’s ambitious plan to elevate the kingdom to a high-income nation by 2050.
The Cultivation of More Human Resources
Cambodia has only two universities with food engineering or technology programs: RUPP, established in 2022, and ITC. Limited student intake restricts access, causing a shortage of human resources. The government and investors should address this by encouraging new programs, vocational schools, and startups to improve access, skills, and workforce quality.
Moreover, there needs to be more vocational schools and programs to teach youngsters skills so they can catch their interest and potentially become professional food processors one day.
Another opportunity Cambodia should seize to boost the processing sector is upon graduating from the United Nations’ Least Developed Country (LDC) status in 2029, as recommended by the United Nations Economic and Social Council.
After graduating, Cambodia can negotiate more free trade agreements with other countries, as these can strengthen the country’s economy and show Cambodia’s capabilities. And food processing is a promising sector for these agreements as it can attract investors, forge alliances and build friendships with other countries. Using these resources, Cambodia can promote them or collaborate with them to further improve cross-country connections and the field's development.
Ren Vimean is an undergraduate pursuing a bachelor’s degree in international relations from the Institute for International Studies and Public Policy. Her research interests lie in Cambodia’s social development and foreign policy.
