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Branching out for business

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Nguon Meng Tech, director-general of the Cambodia Chamber of Commerce, at his office in Phnom Penh last week. Heng Chivoan

Branching out for business

Cambodia is pushing several initiatives to improve the business environment in the country and expand its presence overseas. The Post’s Cheng Sokhorng sat down with Nguon Meng Tech, director-general of the Cambodia Chamber of Commerce (CCC), which boasts over 5,000 members, to discuss the existing business challenges in Cambodia and the chamber’s expansion abroad.

The government has submitted draft legislation to allow the CCC to open representative offices overseas. Have you decided on any of the office locations?
We are still in the process of drafting the new law so we have not yet made any decisions about locations or selection of representatives. We will cooperate with the Ministry of Commerce to determine the criteria for selecting representatives of the CCC abroad and establish their duties.

The new law will give the CCC the ability to select the office locations overseas and the representatives who run them. We will have a meeting on January 30 to further discuss the law and its implementation.

What is the purpose of overseas representation?
Establishing overseas representation of the CCC will provide interested investors in other countries with a good source of information to facilitate potential investments. Our strategy is also to provide opportunities for Cambodian businesses to export to other countries as we have a lot of good products for exports and wealthy Cambodians that would like to invest abroad. The challenges for us right now are guaranteeing the quality of our products for exports and maintaining good quality control, as well as improving our product packaging technology. Improving on these issues would add value to our export products and would hugely benefit the country by increasing national revenue and individual profit.

How do you see the development of online business registration in Cambodia?
The government is reforming the business registration process in order to provide a convenient and faster system for business registration. However, some challenges remain, especially regarding the technical knowledge needed for businesses to register online.

Most business owners don’t know how to fill the forms online and often spend a lot of time filling out the applications, and sometimes needing to hire someone to help them. The CCC has hired technology experts to provide workshops and training sessions on how to file the forms online. These sessions also emphasise the importance of registering a business and maintaining good business records.

What could be done to improve the registration process and access to registry information?
I would recommend that the Ministry of Commerce provide the option to speed up registration by assigning officials to help companies fill out the forms. Issues with business registration don’t only exist in Cambodia – even in the US the country is unable to collect 100 percent of business data.

The World Bank recently said online registration actually decreased the ease of doing business. Do you agree?
My opinion is that the World Bank did not study the issue deeply enough as the development of business registration requires a lot of time to implement and build the infrastructure needed to support it. Right now is not the right time to be critical of the data collection as it is an ongoing process. It shows they did not take enough time to study the issue.

How do the recent tax law amendments impact the business sector?
I have yet to look at the tax law amendments in depth, however, I would like to note that the amendments should be made transparently and the overall tax rate should be lower than that of neighbouring countries given that they are already more developed. The amendments should be made with inputs from the private sector in order to reduce the impact on businesses and the law should be enforced fairly to encourage fair competition in the market. Additionally, I think the law should offer tax exemptions or a tax return policy if, for example, any wealthy businessperson donated large amounts of money to charity.

This interview has been edited for length and clarity.

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