Commerce Minister Sun Chanthol said yesterday that his ministry was initiating reforms that would see Cambodia’s ease of starting a business ranking leap from the current 184 to 21.
Chanthol, who was speaking at a conference on private sector development, said the ministry will set up an online business registration portal by December 2015, where a new business can search for a company name, register the company, get a tax ID and have this data linked to all relevant ministries.
“And the business ranking, if other countries stay the same, will change from 184 to 21. This is based on calculations and simulation that we will have a ranking of 21,” Chanthol said.
The World Bank Group’s Doing Business report is released every year and looks at factors like getting electricity, paying taxes and enforcing contracts, among others. Cambodia ranks 135 out of 189 nations in the ease of doing business for 2015, but does poorly when it comes to other criteria, like ease of starting a business, dealing with construction permits and enforcing contracts.
New Zealand currently leads the pack, where it takes 35 minutes to register a business, according to Chanthol, with Cambodia aiming for one hour.
He said the government would also need to make changes to the Company Registration Law, reduce the expenses associated with starting a business and minimum capital required, and give businesses a one-time license rather than asking them to renew it every three years.
Son Chhay, chief whip of the Cambodian National Rescue Party, said it was not realistic to expect this singular change to attract investment in the country, when there are other pressing issues that need to be addressed.
“Cambodia is not a hotel that you put it online and people will come to invest,” Chhay said.
He said that issues relating to infrastructure, reliable services, transportation and a trade policy need to be worked on holistically before the government can expect to change the country’s business environment.
“I do not think this is realistic. The [investment] confidence is not there,” Chhay added.