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THE 1 st ASEAN COMPITITION CONFERENCE Bali, Indonesia 15-17 November 2011 Presented by Mr. Sok Somontha Cambodia Chamber of Commerce. Key indicators. Small and Medium Enterprise (SME). Country name : Kingdom of Cambodia Location : Southeastern Asia, bordering the Gulf

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THE 1st ASEANCOMPITITIONCONFERENCEBali, Indonesia15-17 November 2011Presented byMr. Sok SomonthaCambodia Chamber of Commerce

key indicators
Key indicators

Small and Medium Enterprise


Country name:Kingdom of Cambodia

Location: Southeastern Asia, bordering the Gulf

of Thailand, between Thailand, Vietnam and Laos

Area:181,035 sq km.


Population growth Rates:2.8 % (2010)

GDPgrowth rate : 9.1% (2010)

GDPper capita : 510 USD (2010)

55% are under 20 years old

Only 15% live in urban centers 73 inhabitants/km2

200,000 young people reach employment age each

year, mainly in rural areas.

Exchange Rate : US$1 = Riels 4 ,070

Capital:Phnom Penh

Government type:

-Multiparty democracy under a constitutional

-Monarchy established in September 1993.Administrative divisions:20 provinces and 4 municipalities.

competition and sme in cambodia
Competition and SME inCambodia
  • We note that the world has a strong interesting on Small and Medium Enterprise (SME). Especially, the Royal Government of Cambodia Recognizes small enterprise development as a key strategy for poverty reduction and economic growth. Small enterprise create jobs for large numbers of women and men, they support the national economy and they meet a broad range of consumer demands. The Royal Government supports Small and Medium Enterprise and drafted a decree to encourage small entrepreneurs to establish associations.
a competition and sme in cambodia cont
A. Competition and SME inCambodia (Cont.)
  • Small business associations can potentially contribute a lot to the development of the small enterprise sector. A small business association is a voluntary alliance between small enterprises. It acts on behalf of its member businesses, Protecting their interests and offering much-needed business development services. Business Associations can help their members to increase their competitiveness and to grasp opportunities in the market place. Small business associations are an indispensable means for developing a market economy.
b status of sme
B. Status of SME

1. Government Policies and Legal Framework

In July 2004, at the first cabinet meeting of the new

Government’s third term in office, the ‘new rectangular’

Strategy for growth, employment, equity and efficiency

was announced:

1- Strengthening the private sector and

attracting investment;

2- Creating jobs and improved working conditions;

3- Promoting SMEs; and

4- Ensuring social safety nets

b status of sme1
B. Status of SME


Government Policies and Legal Framework

The component of promoting SMEs is further delineated

into thirteen ‘policies’. These are as follows:

1 - Encourage the development of SMEs, especially

through the provision of medium and long-term finance.

2 - Suppress smuggling.

3 - Reduce registration procedures and start-up

processes for companies.

4 - Facilitate import-export activities by simplifying

procedures such as licensing and other letters of


b status of sme cont
B. Status of SME (cont.)

Government Policies and Legal Framework

5 - Support for newly established industries for an

appropriate period.

6 - Promote linkages between SMEs & large enterprises.

7 - Establish a national center for productivity to assist

SMEs enhanced their productivity and reduce

production costs.

8 - Establish a national standards institution to help

ensure the quality of domestic products to meet

regional and international standards.

9 - Establish national laboratories for physics, chemistry,

micro-biology, mechanics and test for quality and

criteria of products.

b status of sme cont1
B. Status of SME (cont.)

Government Policies and Legal Framework

10 - Strengthen mechanism for the protection of industrial

intellectual property rights, to prevent illegal copying,

recreation and illegal use of new techniques and


11 - Promote vocational/skills training, both domestic and


12 - Expand and accelerate the “one village, one product”


13 - Strengthen the legal framework by creating laws on

concerns such as : factories, industrial zones, patents

and inventions, measurements and industrial safety.

C. Definition for SMEs.


  • Micro Less than 10 employees
  • Small Between 11-50 employees
  • Medium Between 51-100 employees
  • Large over 100 employees


Determined by Assets, excluding land

  • Micro Less than US$ 50,000
  • Small Between US$ 50-250,000
  • Medium Between US$ 250-500,000
  • Large Over US$ 500,000

For statistical purposes and policy development and implementation, the definition is based on equivalent full-time employees. For other purposes, where the number of employees is not suitable, an alternative financial definition should be used, based on total Assets.

d current state of sme number small industrial establishments by sector year 2011
D. Current State of SMENumber Small Industrial Establishments by Sector Year 2011
e problems faced by sme
E. Problems Faced by SME
  • High Regulatory Compliance Costs
  • Lack of Clear, Market-Oriented Framework

for SME Development

  • Limited Access to Finance and Smuggling.
  • Poor market access infrastructure & information.
  • Policy supporting unclear
  • Low status production
  • Low status quality
  • Lack of capacity-building programs and inadequate provision of vocational training
  • Lack of investment capital
f sme development programs
F. SME Development Programs
  • The Government recognizes that SMEs play a

significant role in promoting economic development

and creating sustainable employment and incomes.

  • Consequently Government developed a SME

Development Framework to improve and coordinate

the Government’s efforts in promoting SME activity

in a market economy.

  • The SME Development Framework is intended to

serve the Government as a road map for the

development of the SME sector.

f sme development programs cont
F. SME Development Programs (cont.)
  • In order to implement the Government’s ‘Rectangular Strategy’ and achieve a conducive business environment, the SME Development Framework focuses on three key areas.

a.Regulatory and legal framework

b. Access to finance

c. SME support activities

f sme development programs cont1
F. SME Development Programs (cont.)

a. Regulatory and legal framework

  • Reduce the barriers and build the necessary system

for effective registration.

  • Reduce regulatory compliance costs by enhancing

governance and responsibilities of the relevant state agencies.

  • Develop basic legal infrastructure needed for

businesses and strengthen the rule of law.

  • Improve trade facilitation to make it low cost, efficient and transparent.
f sme development programs cont2
F. SME Development Programs (cont.)

b. Access to finance

  • Establish secure titling to improve collateral.

base, and effective mechanism of enforcement of

the land law.

  • Create an enabling framework for banks to

provide finance leasing.

  • Establishment a Credit Information Sharing System.
  • Simplified Accounting and Taxation Systems for SMEs.
f sme development programs cont3
F. SME Development Programs (cont.)

C. SME support activities

  • Business Development Services
  • Access to Markets
  • Technology and Human Resources Upgrading
  • Linkages
  • Under the Private Sector Steering Committee, along with 2 other Sub Sub-Committees, creation of the SME Sub Sub-Committee chaired by the Minister of Industry, Mine and Energy in August 2004.
g key challenges
G. Key Challenges
  • Solving the Power Crisis; Reduce Transport Bottlenecks
  • Increased private sector investment and improve Access to Finance.
  • Skills development and improving vocational training
  • Creating a dynamic SME sector
  • Export Diversification – New Sectors and Markets.
  • Opportunities from Greater Regional Integration.
  • To make General provisions and regulations.
  • To get finance possibility for short and long term.
  • Supporting services for SME.
  • Policy coordinating.
  • The SME sector appears likely to remain very important in most developed and developing countries, judging in part by recent trends in both these groups of countries.
  • Competition policy is in need and can make things change positively (for all businesses).
  • Strong political will.
Thank You

for your

kind attention !!!