An official at the Ministry of Industry, Mines and Energy expressed concern that if the quality of Cambodian produced goods does not improve, Cambodia is likely to become largely a retailer of foreign goods when the ASEAN Economic Community (AEC) is realised in 2015.

Meng Saktheara, general director of General Department in the Ministry of Industry, Mines and Energy, told the Post that small and medium-sized Cambodian enterprises would face serious challenges if business owners continuously practice producing goods as families in “informal and uncreative ways”.

“By 2015, we don’t know if Cambodia will be able to be a producer any longer or become a retailer for foreign goods,” he said.

He said the Cambodian market will become a largely retail-based market for imported products when its products cannot compete with other countries’ products, leading to major problems for Cambodian-made goods. 

“Loss of production of Cambodian goods will cause loss of national identity, loss of added value to the national economy and job opportunities,” he said, adding that “SMEs are the backbone of Cambodia’s national economy and they exist throughout the country. It is a linked system.”

Meng Saktheara emphasised that despite ASEAN officials’ focus on building the capacity of SMEs, it is up to private entrepreneurs who operate these production enterprises to commit to strengthen themselves and to do so quickly, because time is running out.

Heng Heang, president of the Phnom Penh Small and Medium Industries Association, said local owners of enterprises are thinking critically about the challenges because it hits domestically produced products.

“I can envisage that some products are steady enough to compete but some could be lost from the market. This is especially something craftspeople should be concerned with,” he said.

Cambodia has more than 500,000 enterprises who provide jobs to 1.6 million people, according to data from the National Institute of Statistics published in March.

Among those 500,000 enterprises, the data also shows there are 13,000 enterprises that employ up to 10 people each, 787 enterprises employing up to 100 people each, and 119 enterprises said they employ up to 1,000 people each.

To contact the reporter on this story: Rann Reuy at [email protected]