Chinese Brands’ Dominance in Cambodia and Laos’ Security Market: Influence, Impact, and Investments

While Cambodia and Laos’ security markets are experiencing growth, Chinese brands, particularly Hikvision Digital Technology and Dahua Technology, are dominating with their competitively priced offerings. These two companies lead the world’s security industry, according to asmag.com’s 2018 Security 50 ranking.

“Mostly, Cambodia now has Hikvision and Dahua left after an industry reshuffle over the past two years,” says Ye Wangfeng, GM of Loxu Digital, Dahua’s exclusive distributor in Cambodia. Unlike Thailand and Vietnam, where various brands coexist, Cambodia’s market is uniquely dominated by these two players.

Chinese brands like Dahua and Hikvision are enjoying immense popularity, as Michael Billen, Managing Director of Eyetech Security Systems in Laos, points out. Their affordability and quality have made them the go-to choice for many in the region.

A significant factor in this domination is the influx of Chinese investors, spurred by China’s Belt and Road Initiative. This development strategy, encompassing infrastructure and investments across continents, has driven Chinese enterprises into Cambodia, leading to increased office space, construction buildings, and retail outlets.

Examples of Chinese investments in Cambodia and Laos are abundant:

• In Sihanoukville, increased Chinese investments since 2013 have transformed the city, leading locals to nickname it “Macau II,” highlighting the surge in Chinese-operated casinos and residents.
• In 2018, Cambodia’s Ministry of Public Works announced the completion of 2,000 kilometers of new roads and other infrastructure projects, largely backed by the Chinese mainland, within the framework of the Belt and Road Initiative.

In Laos, Chinese investment in the energy and mines sector is valued at $10 billion. The Chinese government is actively supporting local investment with funding, collaboration in hydropower projects, and more.

For Chinese investors, choosing Chinese security products is a natural preference. As Kuy Channeth, Sales Project Manager at Cambodia-based V-SAFE, notes, “they will buy from the Chinese.”

Increasingly, Chinese products are being used in non-Chinese projects as well, including government buildings and transportation projects. Dahua cameras, for instance, are installed on traffic signals.

A significant outcome of this influx of Chinese products is increased competition and lower prices, leaving non-Chinese brands struggling to compete. The strong presence of Hikvision and Dahua, coupled with China’s investment through the Belt and Road Initiative, paints a vivid picture of a market where non-Chinese players face challenges that go beyond mere pricing.