Logo of Phnom Penh Post newspaper Phnom Penh Post - Digital economy needs 10 years

Digital economy needs 10 years

Content image - Phnom Penh Post
Minister of Economy and Finance Aun Pornmoniroth (centre) at the Policy and Direction of Cambodia’s Digital Economy workshop. GENERAL DEPARTMENT OF TAXATION

Digital economy needs 10 years

Cambodia's digital economy remains at a nascent stage and will need at least 10 years to grow and aim for a technology-driven economy, said Minister of Economy and Finance Aun Pornmoniroth.

Speaking at the national consultation workshop on Policy and Direction of Cambodia’s Digital Economy on Tuesday, Pornmoniroth said the Kingdom’s digital economy has been gradually taking shape and creating new business activities in digital payment, online entertainment and e-commerce while increasing the number of users who adapt themselves to such technologies.

He said Cambodia may need to spend the first five years to set all of the fundamental elements in place and achieve digital readiness. It will then spend another five or 10 years growing its digital economy to a technology-driven economy.

“The countries that can benefit from the digital economy are those that have access to the digital world and in a timely fashion, adapt themselves to these changes."

“In this regard, for a developing country like Cambodia, new technologies provide an opportunity to leapfrog, bypassing traditional phases of development,” he said.

Pornmoniroth said the government will develop and implement a long-term strategic framework, serving as an overall guide to developing a digital economy. Cambodia, he said, has no intention to create a Silicon Valley or aim to create unicorn companies – start-ups valued at more than $1 billion.

The strategic direction is to create a robust digital environment that allows both small and large firms in the Kingdom to connect to the global digital economy value chain.

Though Cambodia is a developing country, Pornmoniroth said it is a dynamic country with a high potential to seize the opportunities arising from Industrial Revolution 4.0 and base its digital economy on four main factors.

These are a demographic dividend with an increasing number of educated youth who are fast absorbing digital technology, a rapid increase in the use of cell phones and smart devices, fast technological spillovers from foreign direct investment inflow, and a fast digitalisation of all key economic sectors.

The World Bank country director for Cambodia, Myanmar and Laos, Ellen Goldstein, said during the Tuesday workshop that while Cambodia can maintain rapid and sustainable growth, the Kingdom faces challenges such as rising wages.

This, she said, makes it increasingly difficult to continue exporting low-value goods like unprocessed rice and low-end garments. In addition, she said Cambodia is receiving less generous donor financing and its preferential trade treatment is expected to phase out eventually.

“Cambodia will need to find new drivers of growth, as the country will not be able to rely exclusively on those drivers which have proven successful in the past,” she said.

She said the Kingdom’s economic outlook remains positive and would benefit from exploring new drivers of growth that will create jobs and boost prosperity over the next 20 years.

“Digital platforms are expected to play a key role in enabling local entrepreneurs to participate in global value chains more effectively. Financial technology can provide expanded access to finance for both enterprises and individuals as well as facilitate the growth of e-commerce.”

Canadia Bank Plc executive vice-president Charles Vann on Tuesday said the time is right for Cambodia to start preparing its strategy and policy to digitalise the economy, as it is the global and regional trend, and the neighbouring countries are also adjusting to it.

“Once our economy is growing and going along, having prepared now [the policies] to seize the benefits of the digital [era] would be most proper and practical,” he said.

MOST VIEWED

  • Draft law on state of emergency pending finalisation

    Prime Minister Hun Sen will lead a top-level meeting on Tuesdays to review the draft law on imposing a state of emergency. Meantime, he has decided to close all casinos in Cambodia effective April 1. In the press conference after the National Assembly met today, Hun

  • Stranded passengers petition UK for help

    Some 10,521 foreigners in Cambodia, the bulk being from the UK, have signed an online petition calling on British Prime Minister Boris Johnson and relevant officials to fly them out of the Kingdom. The petition is targeted at 15,000 foreigners. Among them are nearly 200 Europeans, the majority

  • State of emergency on table amid pandemic

    Prime Minister Hun Sen, his deputy prime ministers and legal team will meet on Tuesday to review the draft law on declaring a state of emergency, as Covid-19 cases rose to 107 in the Kingdom on Monday. Speaking at a press conference after a parliament meeting

  • Covid-19 Pandemic: Force majeure and legal consequences

    Is the Covid-19 pandemic considered an event of force majeure? The World Health Organisation declared the novel coronavirus (Covid-19) outbreak a pandemic on March 11. Following this declaration, the Ministry of Health and other ministries have taken various legal and administrative measures to prevent the rapid

  • PM set to mend ties with US

    Prime Minister Hun Sen has responded to US Congressman Ted Yoho, saying he is ready to improve Cambodia-US relations, and not take up issues of disagreements which have become a barrier between the two countries’ bilateral cooperation. His response to Yoho came after the congressman

  • Mysterious century-old structure found at bottom of Angkor pond

    The Apsara National Authority (ANA) has discovered a mysterious 1,000-year-old structure of a wooden building at the bottom of a pond after the Angkor Wat temple’s conservation team completed restoring its northern cave. The deputy director at ANA’s Angkor International Research and Documentation