At the Digital Economy Forum II held in Siem Reap, industry experts from other Asian nations shared their insights on digital economy opportunities in the region and for Cambodia.
Mr. Gareth Davies, Chair of the British Chamber of Commerce in Thailand and CTO at DDX; Mr. Souliyo Vongdala, founder and CEO of LOCA, a ride-hailing app in Laos; and Ms. Uyanga Khurelbaatar, Director of the Technology & Digital Solutions Division at Barloworld Mongolia spoke with B2B Cambodia, providing their perspectives on various topics and suggested policy options for Cambodia, as well as insights into the digital landscapes of Laos and Mongolia.
Thailand's Tech Startup Scene
Mr. Gareth Davies presented on Thailand’s tech startup scene at the Digital Economy Forum II, and when he spoke with B2B Cambodia, he highlighted the importance of government support, tax incentives, and digitalisation for the growth of tech startups and cross-border trade in Cambodia.
Davies emphasised the potential for Cambodia to learn from Thailand's experiences and leverage digitalisation to accelerate development. He said that startups, regardless of their sector, can benefit from government support. “I think any startup; technology or not, can receive a lot of help from the government in terms of tax incentives, hiring incentives, [and] a simplified labour law for startups would make things work,” he said. Incentives could be varied, he added, “I think, pushing companies to upskill their staff encourages development, and allowing [some] sort of growth of the company with a reduced tax rate would greatly benefit the startup scene.”
Tax Incentives: A Potential Path for Cambodia's Economic Growth
According to Mr. Davies, Cambodia can draw lessons from Thailand's success in attracting foreign direct investment. The Southeast Asian neighbour has impressed the global business investment community with its welcoming environment. “Thailand has done a great job encouraging businesses all over the world to come and invest in their companies,” he added. Mr. Davies specifically highlighted the attractive investment incentives in Thailand, such as the provision of a "flat rate on income tax" for digital nomads who have chosen to reside in the country for a decade. This policy grants them a substantial 17% tax rate discount, serving as a powerful incentive to foster their long-term commitment. He suggested that Cambodia could consider similar measures, such as reducing corporate income tax for companies that meet the needs of Cambodia in sectors like life sciences or agritech. “If you want to attract foreign direct investment, you need foreign people coming here and investing in businesses,” he concluded.
Opportunities for Regional Cross-Border Trade Amid Digitalisation - A Chance to Leapfrog Other Nations
Mr. Davies discussed the potential for digitalisation to facilitate cross-border trade between Cambodia, Thailand, and other ASEAN countries and he emphasised the need for supply chain and trade processes to be digitalised to make it easier to conduct business across borders. “I think if the supply chain and cross-border trade can be digitalised, then it doesn't matter if it's Thailand, Cambodia, Thailand, Mongolia, or Thailand, and in America, I guess we just need to make sure that we're not all producing the same things,” he added.
Digitalisation provides an opportunity for countries to leapfrog ahead of other growing economies. “I think if things are done properly, if interoperability can be achieved amongst the region, and maybe defence is a good example of that, then there's no reason why countries who are behind now can't leapfrog,” he said.
Laos - Startups and Digital Transformation
Mr. Souliyo Vongdala, the founder and CEO of LOCA, a popular ride-hailing app in Laos, highlighted the advancements in Laos' digital landscape and that the Laotian government is focusing on developing registration laws and legislation to align with digital economy frameworks, such as the ASEAN digital economy framework.
Although Laos already has existing laws related to digital payment systems, an updated version is currently awaiting approval by their parliament. Mr. Vongdala emphasised the importance of taking a regional perspective when considering registration laws, not just focusing on Laos' businesses or the local government. “We have to consider the region or the ASEAN itself, not only focusing on Laos business, or Laos government, that's how we can move forward,” he said. In terms of opportunities for LOCA in Cambodia, he feels that there is an under-served segment in Cambodia they could serve, which is why they are planning to enter the Cambodian market.
Mongolia's Lessons In Digital Transformation
Mrs. Uyanga Khurelbaatar shared her insights on the digital transformation experiences in Mongolia.
Drawing from Mongolia's heavy reliance on the mining sector, she recognised the potential for Cambodia's tourism industry to drive digital economy growth and acknowledged the positive impacts of ride-hailing platforms like Grab and GoJek from Indonesia in accelerating the digital economy, particularly for micro, small, and medium enterprises (MSMEs). Mongolia experienced less severe pandemic impacts but its economy suffered due to the mining industry's dependency on exporting coal to China, which was hindered by border closures.
Ms. Khurelbaatar said Mongolia could learn from Cambodia and that diversifying Mongolia's economy through the development of the tourism sector and leveraging digital transformation to support economic growth was important.
Find Out More From The Digital Economy Forum II:
- US Ambassador Highlights the Importance Of Digital Economy For Cambodia.
- Cambodian 2023 Digital Economy Forum Facilitates Discussion On Bolstering Support For MSMEs.
- Digital Economy Forum II 2023 Day 1: The Evolving Landscape Of Digital Policy Support For MSMEs And Digital Trade
- Digital Economy Forum II 2023 Day 2: Digital Transformation For MSMEs & Cybersecurity