October 12, 2016
Next year will be breakout year for Cambodia's small and medium enterprises (SMEs), with specific zones being organized in each province to promote productivity, quality and regional competitiveness, the president of the SME federation said yesterday. Te Taing Por, president of the Federation of Associations for Small and Medium Enterprises of Cambodia (FASMEC) said that by mid-2017 SME zones in each province, varying in size between three and 20 hectares, would be in operation.
“We have already reserved the land for building the SME zones, but we are waiting for regulations and approval from the government so that we can make it happen. We want the government to support us on this,” Mr. Taing Por said.
He said that the zones would be located near prime agricultural areas, which will ensure easy access to raw materials, in order to aid transport and production of numerous domestically produced products.
“One province, one SME zone, and this is to help small business and handicrafts to have access to a wider market, techniques for production, improved financing, information on regulations and laws, to receive incentive from the government regarding tax exemptions, information on export procedures, and getting lower prices for electricity and water needed for production,” Mr. Taing Por noted, stressing that the zones' primary focus would be on food processing.
He said that it was important for Cambodia to continue to support domestically produced products. He said FASMEC would soon issue calls to all restaurants to only use Cambodian made items when they are available, such as soy sauce and chili sauce.
However, SME directors may require some convincing to move.
Loeng Kimsean, CEO of Loeng Manut Chamkarleu Cashew Nut Company, told Khmer Times that he would consider moving to the proposed zone in Kampong Cham province, but feared his company was presently too small to benefit. “We want to make our business bigger than what it is now, before moving to the SME zone,” he said. Chour Chheng, director of Ky Siv Chheng Protein Food Enterprise – which processes and sells dried meat, fruit and jam – said that such a zone might improve communication between suppliers and producers, but he had no plans to move.
“Not only my enterprise, but also other local enterprises are not planning to move from our location to a SME zone because we have our own buildings and our production is already environmentally friendly,” Mr. Chhengtold Khmer Times.“If we move we will have to spend for leasing the buildings in the SME zone and pay the costs of transporting our machinery,” he said. If there were suitable incentives for moving, such as free rent and tax breaks for the first five years, then that might encourage his company, and other local SMEs to move, Mr. Chheng added.Mr. Taing Por appeared to anticipate such concerns, stressing yesterday that the government's assistance was required in making the zones a success. “We need the support from the government when the SMEs enter the SME zones. The government must provide them with incentives such as an exemption on revenue tax from three to five years and others in order to help them,” he said.