Developing countries need to strengthen the competitiveness of small businesses in order to benefit from the global trading system, a Ministry of Commerce official said at the start of a three-day regional conference on private sector development.
“Cambodia, like other [least developed countries], will not reap the fruits of economic growth unless we have the capacity and capability to overcome and harness these challenges,” Sok Siphana, Commerce Ministry secretary of state, told a consortium of business representatives, donors and government officials on Tuesday at the Hotel Intercontinental.
Over the past few years, the government and donors have conducted a number of competitiveness studies that show small businesses are often constrained by high electricity costs, excessive bureaucracy and lack of market knowledge, among other things.
With the country on the verge of joining the World Trade Organization, the government’s strategy is to identify certain industries and product groups that can expand the economy and be exported.
Some of these products include rice, cotton, textiles, garments, tobacco, canned milk and motorcycle assembly, according to a paper by Sok Siphana.
To improve Cambodia’s competitiveness, the government needs to strengthen the physical infrastructure—such as roads, electricity and Internet networks
—and improve the regulatory framework, he wrote.
“The higher cost of bureaucratic red tape and domestic transport constrain the ability of Cambodia to compete on world markets,” the paper says.
In another paper to be presented at the conference, Hark Khim Leong, business development resources manager of the Royal Group of Companies, lists nine constraints affecting the private sector. They include rampant border smuggling, high hidden fees for imports and widespread corruption. To help the private sector, Hark Khim Leong listed only two recommendations: Governance reforms and a fair judicial system.
