Import-export broker Be Vanthon, 36, is busying entering data into a computer. He smiles and says, “This new system saves me a lot of time and makes our work easier and smoother.” He continues. “I can do it three times as fast as before, when I had to fill in all documents by hand. It took me and my colleagues a long time.”
Marketing graduate student Sao Hok, 25, who started his career as a broker for Teng Lay company two years ago agrees with Vanthon. “You know, for the same goods we just change the figure and the date in the system because the same form is already there; then it is done. Before, I had to fill in the whole document every time.”
Vanthon and Hok are among more than 200 brokers who use the ASYCUDA (Automated System for Customs Data) office in Sihanoukville International Port. The office has 15 computers linked to the Customs database. The program, which was installed in late 2006 to improve efficiency in trade facilitation and increase government revenue, is supported by the World Bank under the US$10 million Trade Facilitation Project.
Although Vanthon and Hok are full of praise for the way the computerized system helps them with their daily work, they say they would like to see more steps taken toward further trade facilitation. They, and many other brokers, would like to see the ASYCUDA system go online so that they can complete the paperwork from their own company offices. “It will help us more if the ASYCUDA system is installed on-line,” they said. “We would prefer not to have to come and wait to use one of the computer terminals in the Customs office here. Sometimes we have to queue.”
Roger Tan, Managing Director for the Thai-pare Garment Manufacturing Co., Ltd. and the Secretary of Garment Manufacturers’ Association in Cambodia (GMAC) believed: “If the Government agrees to ASYCUDA going on-line, the time saving and efficiency of public service will increase many folds.”
The ASYCUDA program is one example of the progress made in Cambodia in the last few years towards trade facilitation. The time and cost of doing business in Cambodia has been decreased by recent changes such as the reduction of bureaucratic red tape and extensions to the tax holiday for newly arrived businesses.
Learning lessons from the past, and looking ahead towards an improved trade environment in Cambodia to attract investors, like the ASYCUDA program, are the goals of a new Trade Development Support Program (TDSP) to be launched on March 23, 2009. This program will assist government agencies to integrate with the international economy and to find new roads for doing business with Europe, Asia and America. TDSP focuses on legal reforms, investment regulation and trade facilitation.
“With global trade expected to shrink in 2009 for the first time in 27 years and Cambodia’s economy under real pressure, this program can help Cambodia attract more investors and can contribute to Cambodia’s growth,” Qimiao Fan, World Bank Country Manager said.
The US$12.6 million grant for the TSDP is financed by donations from the European Union, the Danish government and the United Nations Industrial Development Organization. It will be managed by the Cambodian Government through –the Ministry of Commerce – under the coordination of the World Bank in dialogue with development partners.
Roger Tan, Managing Director for the Thai-pare Garment Manufacturing Co., Ltd. and the Secretary of Garment Manufacturers’ Association in Cambodia (GMAC), said Cambodia has many issues that need to be addressed, and he hoped the TDSP would make a significant contribution. He said the cost of operations in garment manufacturing remained high compared with competing countries. And in the current deteriorating world market conditions, garment buyers demand even quicker delivery.
“Cambodia will have difficulty to compete with the countries that have their own raw material supply,” he said. “Given the current difficult market situation, the demands for high skill and low cost are priorities to win market share.”
Mr. Tan suggested four main points should be considered. First, the government must seriously and immediately look into more trade facilitation. Second, the public sector must be informed of the need to compete with the rest of the world to survive. Third, persistent unrest and unreasonable demands on employers (especially at this difficult time) will force out investors and discourage new investments. Finally, the Government and the people of Cambodia must make short-term sacrifices for long-term gains.
Discussing the transport sector, Chhim Sokan, Chairman of the Board of Directors for the Cambodia Trucking Association and the President of Sokan Transport Co. Ltd, said the transport service industry also faced challenges. Most of the service his member companies provided was based on credit. When a client closed their business or ran away, there was no mechanism to ensure the service provider was paid, so the transport company ended up carrying a bad debt.
Another challenge, he said, is the unfair competition between registered companies and unregistered firms. The unregistered firm had an advantage, and the government should regulate to ensure a level playing field.
(The original article is extracted from The World Bank newsletter, April 2009)
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