Prime Minister Hun Manet recently emphasised the crucial role of small and medium-sized enterprises (SMEs) in strengthening the Cambodian economy and called for continued focus on the sector by relevant ministries, institutions and the private sector.
Manet made the remarks during the official inauguration of the Ministry of Industry, Science, Technology and Innovation’s Techo Sen office building and the closing ceremony of its 2023 annual review meeting.
“The fundamentals and structure of our economy are dependent on the private sector, which is the core force. Within this sector, the SMEs play a vital role. We must recognise that SMEs are the very foundation of our economy,” he stated.
Citing the most recent data from 2018, the premier noted that micro, small and medium enterprises constitute over 99% of businesses in the country. While acknowledging the limited growth in large companies, he urged the relevant ministries and institutions to continue promoting and strengthening the sector.
“Of course, large companies continue to be drawn to invest in Cambodia, but we mustn’t overlook the small companies, the SMEs. I have observed progress in this sector, yet I believe there remains a significant amount of untapped potential that demands further consideration,” he added.
Manet also encouraged the ministry and associations working in the sector to motivate informal ventures to integrate into the formal economy and to increase arrangements for SME clusters, thereby enhancing the sector’s role in the Kingdom’s economy both presently and in the future.
He highlighted the important contribution of SMEs to employment and the gross domestic product (GDP), with about 70 per cent of employment and nearly 60 per cent of GDP coming from the sector.
“Therefore, it is imperative that we act to support SMEs. To fully realise their full potential, we must focus on transforming the characteristics of the informal sector into the formal. The policy direction we have established provides a substantial foundation for this endeavour,” he said.
At the same time, industry minister Hem Vanndy outlined ongoing efforts to strengthen the sector. He said this includes promoting SME registration through the Ministry of Economy and Finance’s Cambodia Data Exchange (CamDX) platform, providing training on its usage and fostering SME development in cooperation with relevant partners.
He noted that Khmer Enterprise (KE), which operates under the finance ministry, continues to support SMEs in becoming competitive in both domestic and international markets.
“We will continue to expand the ministry’s support to the private sector, especially SMEs, in the areas of production technical skills, industry, manufacturing and processing to strengthen the backbone of the national economy,” Vanndy stated.
He added that the ministry would continue to support the diversification of the national economy by promoting industrialisation, encouraging the informal economy to integrate into the formal sector, and building entrepreneurial ecosystems.
He said these efforts aim to enhance value-added technology, foster modernisation and develop new mindsets in the production and service chains of enterprises and entrepreneurs, ensuring competitiveness and excellence.
Te Taingpor, president of the Federation of Associations for Small and Medium Enterprises of Cambodia (FASMEC), spoke on February 21 about the group’s efforts to support the government’s policy of strengthening SMEs.
He said the association regularly conducts training courses for members across the country to bolster small companies and address their challenges.
“As we are all aware, the majority of businesses in our country fall into the SME category. However, this category has not been clearly defined yet. We require time to establish a proper classification for SMEs and to encourage informal [ones] to transition into the formal sector. This will facilitate easier data collection and policy development by associations and governments,” he explained.
According to a report from the industry ministry, by the end of 2023, there were a total of 44,628 SMEs in the Kingdom. This included 8,048 businesses owned by women and a total labour force of 463,966 people, with 135,290 women employed.
Source: https://www.phnompenhpost.com/national/manet-highlights-the-driving-force-of-nation-s-smes