The Vital Role of Women led Entrepreneurs in Cambodia’s Economy
Driving Economy
- Women-owned businesses are driving Cambodia’s economy forward. Micro, small and medium-sized enterprises (MSMEs) constitute the backbone of Cambodia’s economy and account for 99.8 percent of its businesses. MSMEs provide 58 percent of GDP and 70 percent of total employment. 61 percent of these MSMEs are owned by women. This proportion of women-run businesses in the economy is actually one of the highest among the ASEAN nations.
- However, women face disproportionate challenges in starting and growing businesses. Societal norms and limited resources restrict women’s full participation and business expansion opportunities. Bridging this gender gap in entrepreneurship could unlock billions in regional GDP and create millions of new jobs.
- Supporting women-owned businesses and helping them break the pattern of exclusion and limited opportunities is an investment in women’s economic empowerment and the future of Cambodia’s inclusive economic growth.
Social Impact
- Women entrepreneurs play a crucial role in promoting gender equality. By leading businesses they challenge traditional gender roles and serve as role models inspiring more women to pursue entrepreneurship.
- Many women-led MSMEs are community-focused. They often reinvest their earnings into local communities, enhancing education, healthcare and other social services.
- Women bring unique perspectives and creativity to business, fostering innovation. Their approach can lead to the development of new products and services that cater to diverse needs.
Challenges faced by Women led MSMEs in Cambodia
- Even though 51% of the population is female, less than 20 percent of small and medium enterprises owned by women have access to formal financial services. Limited collateral or lack thereof coupled with gender bias present in the financial sector serve as serious obstacles to this endowment. Microfinance institutions often consider businesses run by women as “high-risk” thus charging them higher interest rates or limiting loan amounts.
- In Cambodia, women-owned micro and small businesses encounter significant regulatory and legal challenges in accessing necessary locations and services. Traditional gender roles and societal expectations further limit opportunities for women. Female entrepreneurs often experience greater difficulties in securing funding and lack mentorship compared to their male counterparts. Socio-cultural norms restrict women’s participation in community decision-making, favoring men in terms of collateral and limiting women’s voices. Providing education and training in business management, financial literacy and technology is crucial for the growth of women-led MSMEs.
Supporting Women Entrepreneurs to unlock Cambodia’s Economic Potential
Providing Access to Finance
- One of the major issues that Cambodian women entrepreneurs face when they want to start or expand their businesses is access to finance. There are tailor-made loan programs that can solve this problem for women-led SMEs. For example, SME Bank of Cambodia have launched The Cambodia Women Entrepreneurs Scheme (CWES) to provide financial support to women entrepreneurs in Cambodia with favorable conditions and affordable cost. Women entrepreneurs can use this scheme to expand their business or start a new business.
Building Entrepreneurial Skills
- Women can acquire business planning skills as well as other crucial competencies such as accounting and marketing through training courses. Entrepreneurship training for women in Cambodia is provided by both public and private sector organizations. However, there is a need to upscale these initiatives further so that the content of the training becomes more practical and relevant to the reality of micro/small businesswomen.
Improving Access to Markets
- Trade Fairs, Business expos and online forums increase visibility for women-owned SMEs while helping them reach new consumers as well as business connections. The government working alongside NGOs coupled with associations of businesses must help them engage themselves in e-commerce, making use of online marketplaces besides participating in trade fairs through providing logistics facilities. Export promotion agencies can also provide support to help women access international markets.
Way Forward
The growth of the Cambodian economy heavily relies on women entrepreneurs running micro, small and medium-sized enterprises (MSMEs). These women play a crucial role in providing employment, supporting their families and strengthening communities through their business and financial skills. For Cambodia’s economy to continue thriving, it is essential to support and empower women to excel as business owners. Empowering women to reach their full potential offers hope for a prosperous future.
