Cambodia has decided to implement conscription law from January 2026 after approximately 20 years of suspension, potentially creating significant impacts on Southeast Asian labor markets and international business environment. Prime Minister Hun Manet"s announcement targets citizens aged 18-30, with mandatory service for men and voluntary for women, currently set at 18 months but expected to extend to 24 months. The military tensions with Thailand following conflicts in late May contributed to this decision.
Out of Cambodia"s population of approximately 17.28 million, about 3.82 million people (22% of total population) fall within conscription age, indicating serious labor market implications. Importantly, conscripts can maintain their corporate employment during military service and choose between resuming corporate work or continuing military service after completing 24 months. However, uncertainty remains regarding who bears National Social Security Fund (NSSF) costs during service period—companies or the state—creating unclear human resource cost burdens for businesses.
This implementation makes Cambodia the sixth Southeast Asian country with conscription (following Singapore, Thailand, Myanmar, Vietnam, and Laos), symbolizing regional security environment changes. Japanese companies in economic zones have expressed concerns about "labor shortages" and "potential supply chain reviews if employment costs continue during conscription," potentially forcing reconsideration of Southeast Asian business strategies.
Legal aspects include exemptions for monks, prisoners, and those with health issues, 30-day processing requirements after conscription notices, up to three deferrals (not exemptions), and maximum five-year imprisonment for willful non-compliance. These details may change with conscription law amendments, requiring continuous information gathering and response strategy development from companies.
These developments are expected to create multi-faceted impacts including heightened geopolitical risks, labor-intensive industry recruitment difficulties, and corporate Southeast Asian strategy reconsiderations, serving as crucial considerations for Japanese companies" Southeast Asian investment strategies, particularly in manufacturing sectors.