‘Establishing Special SME Zones will further drive economic growth’

‘Establishing Special SME Zones will further drive economic growth’

Cambodia needs industrial communities focused on raw material processing in all provincial capitals.

Creating a Special Small and Medium Enterprise (SME) Zone for local product processing shall boost the sector’s development and further contribute to Cambodia’s economic growth, said Lim Heng, Vice President of the Cambodian Chamber of Commerce (CCC) on Thursday.

Speaking to local media, Heng emphasised the importance of both domestic and export markets in ensuring the sustainability of production and supply.

“To maintain the sustainability of both domestic supply and exports, we need strong domestic and international markets,” he said, adding, “That’s why our exports must rely on various free trade agreements, such as the Cambodia-China Free Trade Agreement, the Regional Comprehensive Economic Partnership (RCEP) Agreement, the Cambodia-Korea Free Trade Agreement (CKFTA) and others.”

Heng also highlighted the need to establish Special SME Zones focused on product processing.

“We already have modern agricultural communities established by the Ministry of Agriculture, Forestry and Fisheries. However, Cambodia also needs industrial communities focused on raw material processing, which we demand in many regions or all provincial capitals,” said Heng.

“We envision the creation of Special SME Zones. While we already have Special Economic Zones (SEZ), we lack favourable zones tailored specifically for SMEs. With adequate infrastructure like roads, water, electricity, and human resources, the state can support and provide access to capital. These zones could cover areas of 50 to 100 hectares and be divided into smaller lots, similar to residential developments like ‘Borey’, which would also help build confidence among banks to invest in small enterprises,” he explained.

If Cambodia establish this zone, it will succeed because it will have a physical location, government support, and also support from other commercial banks.

He further to say that the goal is to promote the processing industry at the provincial and district levels, allowing raw materials to flow directly into these zones. With Cambodia’s growing number of free trade agreements, such special processing zones are a crucial key to boosting exports and ensuring Cambodian agricultural products are 100 percent processed.

He added that once Cambodia has these SME zones, the country’s economic growth will accelerate, especially since the government has recognised agriculture as the backbone of the national economy in the post-Covid-19 context.

Heng noted that former Prime Minister Hun Sen, now President of the Senate, has designated the northwest region as a rice and fish production hub.

“Therefore, I believe that establishing Special SME Zones will significantly contribute to national economic growth, particularly by enhancing the processing of our agricultural products,” Heng emphasised.

Prime Minister Hun Manet, while addressing a meeting and solidarity dinner with the Cambodian SME and Handicrafts community last month, said that micro, small, and medium enterprises (MSMEs) play a vital role in Cambodia’s economy.

He noted that MSMEs are actively engaged in manufacturing, supplying goods and services, and are working to adapt to emerging trends, particularly shifting market demands, environmental requirements, and rapid technological advancements.

The Premier went on to add: “This sector covers a wide range of economic activities, creating jobs and businesses, increasing income, reducing migration, supporting vulnerable populations in achieving sustainable livelihoods, promoting economic development and social stability, and contributing significantly to the growth of the private sector.”

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