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Ministry changes SME data

Employees at a small e-commerce business at work in 2016.
Employees at a small e-commerce business at work in 2016. Eliah Lillis

Ministry changes SME data

Readers of the Ministry of Industry and Handicraft’s summarised annual report may have been shocked to find the number of small- and medium-size enterprises (SMEs) operating in Cambodia was nearly four times larger than it was reported to be last year.

That’s because the ministry has changed the way it tracks SMEs, according to Laim Kim Leng, director-general of the SME department at the ministry. The policy, part of the government’s decentralisation push, was met with scepticism from a private-sector representative of SMEs, who said yesterday the changes failed to improve the situation for small businesses in the country.

“The data this year is more concrete than last year because of our decentralised policy to collect all the data from the sub-level, rather than base everything only on the data of the general department of SMEs,” Kim Leang said yesterday.

The changes were applied retroactively to previous years as well, and no mention of the methodological change or previous numbers is made in the new report.

For example, in the 2016 report, the ministry recorded a total of 39,141 local SMEs operating at the end of the 2016, but last year’s report claimed 152,332 SMEs were operating at that time.

Te Taingpor, head of the Federation of Association for Small and Medium Enterprises of Cambodia, said yesterday that he had “no idea” how the ministry collected the new numbers and called on the government to release any documents it had as proof.

Kim Leng said the ministry did possess the documentation to prove the claims, but declined to provide it to a reporter yesterday, saying it was the “private information of the ministry”.

“We have enough documents to prove our work efficiently,” he said. “The private sector has the right to . . . believe it or not, it is their business.”

Taingpor, whose association has over 300 members and 25 offices across the country, has previously been critical of the ministry’s alleged lack of progress formalising the SME sector. He remained unimpressed yesterday, noting any reforms regarding decentralisation were not addressing the main problems facing SMEs.

“The challenges of SMEs are still the same,” he said yesterday. “There is unfair competition in the market, and the tax enforcements are not balanced, while free flow of imported products into the markets hurts smallholder SMES.”

The full annual report is scheduled to be released March 12.