Back
About RSIS
Introduction
Building the Foundations
Welcome Message
Board of Governors
Staff Profiles
Executive Deputy Chairman’s Office
Dean’s Office
Management
Distinguished Fellows
Faculty and Research
Associate Research Fellows, Senior Analysts and Research Analysts
Visiting Fellows
Adjunct Fellows
Administrative Staff
Honours and Awards for RSIS Staff and Students
RSIS Endowment Fund
Endowed Professorships
Career Opportunities
Getting to RSIS
Research
Research Centres
Centre for Multilateralism Studies (CMS)
Centre for Non-Traditional Security Studies (NTS Centre)
Centre of Excellence for National Security
Institute of Defence and Strategic Studies (IDSS)
International Centre for Political Violence and Terrorism Research (ICPVTR)
Research Programmes
National Security Studies Programme (NSSP)
Social Cohesion Research Programme (SCRP)
Studies in Inter-Religious Relations in Plural Societies (SRP) Programme
Other Research
Future Issues and Technology Cluster
Research@RSIS
Science and Technology Studies Programme (STSP) (2017-2020)
Graduate Education
Graduate Programmes Office
Exchange Partners and Programmes
How to Apply
Financial Assistance
Meet the Admissions Team: Information Sessions and other events
RSIS Alumni
Outreach
Global Networks
About Global Networks
RSIS Alumni
Executive Education
About Executive Education
SRP Executive Programme
Terrorism Analyst Training Course (TATC)
International Programmes
About International Programmes
Asia-Pacific Programme for Senior Military Officers (APPSMO)
Asia-Pacific Programme for Senior National Security Officers (APPSNO)
International Conference on Cohesive Societies (ICCS)
International Strategy Forum-Asia (ISF-Asia)
Publications
RSIS Publications
Annual Reviews
Books
Bulletins and Newsletters
RSIS Commentary Series
Counter Terrorist Trends and Analyses
Commemorative / Event Reports
Future Issues
IDSS Papers
Interreligious Relations
Monographs
NTS Insight
Policy Reports
Working Papers
External Publications
Authored Books
Journal Articles
Edited Books
Chapters in Edited Books
Policy Reports
Working Papers
Op-Eds
Glossary of Abbreviations
Policy-relevant Articles Given RSIS Award
RSIS Publications for the Year
External Publications for the Year
Media
Cohesive Societies
Sustainable Security
Other Resource Pages
News Releases
Speeches
Video/Audio Channel
External Podcasts
Events
Contact Us
S. Rajaratnam School of International Studies Think Tank and Graduate School Ponder The Improbable Since 1966
Nanyang Technological University Nanyang Technological University
  • About RSIS
      IntroductionBuilding the FoundationsWelcome MessageBoard of GovernorsHonours and Awards for RSIS Staff and StudentsRSIS Endowment FundEndowed ProfessorshipsCareer OpportunitiesGetting to RSIS
      Staff ProfilesExecutive Deputy Chairman’s OfficeDean’s OfficeManagementDistinguished FellowsFaculty and ResearchAssociate Research Fellows, Senior Analysts and Research AnalystsVisiting FellowsAdjunct FellowsAdministrative Staff
  • Research
      Research CentresCentre for Multilateralism Studies (CMS)Centre for Non-Traditional Security Studies (NTS Centre)Centre of Excellence for National SecurityInstitute of Defence and Strategic Studies (IDSS)International Centre for Political Violence and Terrorism Research (ICPVTR)
      Research ProgrammesNational Security Studies Programme (NSSP)Social Cohesion Research Programme (SCRP)Studies in Inter-Religious Relations in Plural Societies (SRP) Programme
      Other ResearchFuture Issues and Technology ClusterResearch@RSISScience and Technology Studies Programme (STSP) (2017-2020)
  • Graduate Education
      Graduate Programmes OfficeExchange Partners and ProgrammesHow to ApplyFinancial AssistanceMeet the Admissions Team: Information Sessions and other eventsRSIS Alumni
  • Outreach
      Global NetworksAbout Global NetworksRSIS Alumni
      Executive EducationAbout Executive EducationSRP Executive ProgrammeTerrorism Analyst Training Course (TATC)
      International ProgrammesAbout International ProgrammesAsia-Pacific Programme for Senior Military Officers (APPSMO)Asia-Pacific Programme for Senior National Security Officers (APPSNO)International Conference on Cohesive Societies (ICCS)International Strategy Forum-Asia (ISF-Asia)
  • Publications
      RSIS PublicationsAnnual ReviewsBooksBulletins and NewslettersRSIS Commentary SeriesCounter Terrorist Trends and AnalysesCommemorative / Event ReportsFuture IssuesIDSS PapersInterreligious RelationsMonographsNTS InsightPolicy ReportsWorking Papers
      External PublicationsAuthored BooksJournal ArticlesEdited BooksChapters in Edited BooksPolicy ReportsWorking PapersOp-Eds
      Glossary of AbbreviationsPolicy-relevant Articles Given RSIS AwardRSIS Publications for the YearExternal Publications for the Year
  • Media
      Cohesive SocietiesSustainable SecurityOther Resource PagesNews ReleasesSpeechesVideo/Audio ChannelExternal Podcasts
  • Events
  • Contact Us
    • Connect with Us

      rsis.ntu
      rsis_ntu
      rsisntu
      rsisvideocast
      school/rsis-ntu
      rsis.sg
      rsissg
      RSIS
      RSS
      Subscribe to RSIS Publications
      Subscribe to RSIS Events

      Getting to RSIS

      Nanyang Technological University
      Block S4, Level B3,
      50 Nanyang Avenue,
      Singapore 639798

      Click here for direction to RSIS

      Get in Touch

    Connect
    Search
    • RSIS
    • Publication
    • RSIS Publications
    • CO18004 | Cambodia’s Knowledge-based Economy: More than BRI
    • Annual Reviews
    • Books
    • Bulletins and Newsletters
    • RSIS Commentary Series
    • Counter Terrorist Trends and Analyses
    • Commemorative / Event Reports
    • Future Issues
    • IDSS Papers
    • Interreligious Relations
    • Monographs
    • NTS Insight
    • Policy Reports
    • Working Papers

    CO18004 | Cambodia’s Knowledge-based Economy: More than BRI

    10 January 2018

    download pdf

    Synopsis

    The Digital Silk Road component of China’s Belt and Road Initiative (BRI) provides Cambodia with an opportunity to advance on its path towards the knowledge-based economy. While both Cambodia and China can achieve a win-win situation, Phnom Penh’s position in ASEAN can also be strengthened.

    Commentary

    EARLIER THIS year, Huawei, a leading Chinese telecommunication company, sealed a partnership with Malaysia’s Smart Axiata to launch 4.5G mobile connectivity in Cambodia. This will give ten times faster mobile Internet speed than normal 4G. This is just an example of China’s role and potential in Cambodia’s economic development. China contributed the highest share of invested capital (30%) and bilateral aid (36%) for Cambodia in 2016. In 2016 alone, total trade between Cambodia and China reached US$4.8 billion while Chinese investments in Cambodia amounted to more than US$5.1 billion. It is timely for Cambodia that the Digital Silk Road component of China’s Belt and Road Initiative (BRI) is gaining momentum.

    Digital Silk Road

    Cambodia is a fast growing developing economy. The country aims to boost its technological skill and infrastructure base on its path towards a knowledge-based economy as envisioned in Cambodia’s Industrial Development Policy (IDP) 2015-25. To realise this vision, the country needs to tap the bigger platform of economic opportunities on digital technologies and sustainable development under the Digital Silk Road.

    Traditional physical infrastructure like roads and energy provides the foundation for trade and economic growth. But technology and innovation infrastructure provides the tools for Cambodia to take bigger leaps to advance towards a middle-income country. Negotiating more investment and aid under the Digital Silk Road shall enable Cambodia to employ the Internet of Things and Industry 4.0.

    This can lead to opportunities including competitiveness enhancement, economic diversification, skill upgradation and deeper participation in regional and global value chains. During Prime Minister Hun Sen’s visit to China for the Belt and Road Summit in May 2017, China granted US$240 million in aid to Cambodia covering agreements
    including telecommunication, marine environment monitoring and other physical infrastructure.

    Telecommunications

    While Cambodia has achieved good results in the telecommunication industry, opportunities are still available in upgrading the backbone and enhancing countrywide access. This is highly relevant in light of recent developments on Cambodia signing the cross-border paperless trade facilitation agreement, inclination towards
    advanced manufacturing, promotion of e-governance, expansion of fintech businesses, increasing interest in launching satellite and implementing smart cities initiative. Developing ICT infrastructure is a priority area under Cambodia’s ICT Master Plan 2020. It is worth noting that at least two leading Chinese companies, Huawei and ZTE, already have active presence in the telecommunication sector in Cambodia. They plan to be major players in China’s BRI projects abroad. The telecommunication business in Cambodia is relatively limited unless the companies in Cambodia are able to penetrate the market of the Greater Mekong Sub-region (GMS).

    In this respect, those firms operating out of Cambodia will face stiff competition from their Vietnamese and Thai counterparts. One way is for Huawei and ZTE as well as Smart Axiata to design their future expansion in Cambodia through joint ventures with associated companies in mainland Southeast Asia.

    For Cambodian engineering and technology-based firms, their development and survival will depend on the ability to serve as partners or sub-contractors with the bigger and leading foreign companies as they move into local markets to develop telecommunication infrastructure under investment cooperation in the Chinese BRI framework.

    Scientific Cooperation and Sustainable Development

    Cambodia’s path towards becoming a knowledge-based economy begins with development of the skills base for technology and knowledge-based industries. Enhancing R&D capability is a priority under Cambodia’s National Science and Technology Master Plan 2014-2020 and IDP.

    Given the priorities of the Cambodian government, China’s planned Belt and Road Science, Technology and Innovation Cooperation Action Plan is very pertinent. This plan will consist of providing short-term visits to 2,500 young scientists, train 5,000 foreign scientists, engineers and managers as well as set up 50 joint laboratories in
    the next five years.

    Cambodia harbours a diverse base of natural resources given its geographical position in the GMS. It is necessary to implement policies to accelerate educational and skills development, and to orientate Cambodia’s participation in ASEAN economic and socio-cultural cooperation to create a broad and sustainable foundation for Cambodia’s knowledge-based future.

    Risk Management

    While there is potential for numerous opportunities under the BRI framework, Cambodia should also properly understand potential risks and devise strategies to manage them.

    Information Security

    Information security concerns from using foreign-built telecommunication infrastructure is not new. However, in a changing geopolitical scenario of increasing number of countries developing economic, political and military ties with China, the question is whether Cambodia should let these concerns deprive itself of economic
    opportunities.

    One way to go forward is to enhance the capacity of local authorities to monitor the technical processes of project management as well as negotiate proper terms with their counterparts and businesses in China when projects are being mooted. Examples could include limiting equipment manufacturers’ access to sensitive data, ensuring ownership of patent rights and requiring transparency.

    Environmental, Social and Governance (ESG) considerations

    ESG considerations are often raised when discussing Chinese investments in developing countries. Nevertheless, Chinese investments also allow much flexibility to national governments. Hence, rather than resisting investments, an approach to enhance ESG compliance can be ensured through institutionalising proper frameworks.

    Moreover, there should be due diligence mechanisms within the national systems to conduct proper feasibility and commercial viability assessments of infrastructure projects. The ongoing collaboration of multilateral development agencies with China on sustainable development issues can be extended to build institutional and oversight capacities in developing countries.

    Win-win Situation

    China launched BRI in 2013 to support the development of trade and infrastructure network in partner countries (currently 68) ranging from Europe along Central Asia through Southeast Asia into the Indian Ocean and beyond. Such a mega project serves China’s national interests.

    Firstly, it allows exporting China’s surplus productive capacity to sustain prosperity at home. Secondly, it enables China to establish strategic geopolitical influence in specific regions and states through soft power. Cambodia must identify areas most beneficial to its own interests and capitalise on suitable opportunities.

    While meeting Cambodia’s development goals, strengthening the country’s position in ASEAN — Southeast Asia’s only regional organisation — must also rank as an important objective. Technological advances will raise Cambodia’s development status and give it a stronger voice in ASEAN and beyond. In turn, this will help accelerate Cambodia’s development and progress.

    About the Author

    Prashanta Pradhan is a trade and investment policy specialist advising development agencies and governments, currently, based in Phnom Penh, Cambodia. He holds a Master’s degree in Public Policy from the Lee Kuan Yew School of Public Policy, National University of Singapore. He contributed this to RSIS Commentary.

    Categories: RSIS Commentary Series / Country and Region Studies / International Political Economy / International Politics and Security / Non-Traditional Security / East Asia and Asia Pacific / Southeast Asia and ASEAN

    Synopsis

    The Digital Silk Road component of China’s Belt and Road Initiative (BRI) provides Cambodia with an opportunity to advance on its path towards the knowledge-based economy. While both Cambodia and China can achieve a win-win situation, Phnom Penh’s position in ASEAN can also be strengthened.

    Commentary

    EARLIER THIS year, Huawei, a leading Chinese telecommunication company, sealed a partnership with Malaysia’s Smart Axiata to launch 4.5G mobile connectivity in Cambodia. This will give ten times faster mobile Internet speed than normal 4G. This is just an example of China’s role and potential in Cambodia’s economic development. China contributed the highest share of invested capital (30%) and bilateral aid (36%) for Cambodia in 2016. In 2016 alone, total trade between Cambodia and China reached US$4.8 billion while Chinese investments in Cambodia amounted to more than US$5.1 billion. It is timely for Cambodia that the Digital Silk Road component of China’s Belt and Road Initiative (BRI) is gaining momentum.

    Digital Silk Road

    Cambodia is a fast growing developing economy. The country aims to boost its technological skill and infrastructure base on its path towards a knowledge-based economy as envisioned in Cambodia’s Industrial Development Policy (IDP) 2015-25. To realise this vision, the country needs to tap the bigger platform of economic opportunities on digital technologies and sustainable development under the Digital Silk Road.

    Traditional physical infrastructure like roads and energy provides the foundation for trade and economic growth. But technology and innovation infrastructure provides the tools for Cambodia to take bigger leaps to advance towards a middle-income country. Negotiating more investment and aid under the Digital Silk Road shall enable Cambodia to employ the Internet of Things and Industry 4.0.

    This can lead to opportunities including competitiveness enhancement, economic diversification, skill upgradation and deeper participation in regional and global value chains. During Prime Minister Hun Sen’s visit to China for the Belt and Road Summit in May 2017, China granted US$240 million in aid to Cambodia covering agreements
    including telecommunication, marine environment monitoring and other physical infrastructure.

    Telecommunications

    While Cambodia has achieved good results in the telecommunication industry, opportunities are still available in upgrading the backbone and enhancing countrywide access. This is highly relevant in light of recent developments on Cambodia signing the cross-border paperless trade facilitation agreement, inclination towards
    advanced manufacturing, promotion of e-governance, expansion of fintech businesses, increasing interest in launching satellite and implementing smart cities initiative. Developing ICT infrastructure is a priority area under Cambodia’s ICT Master Plan 2020. It is worth noting that at least two leading Chinese companies, Huawei and ZTE, already have active presence in the telecommunication sector in Cambodia. They plan to be major players in China’s BRI projects abroad. The telecommunication business in Cambodia is relatively limited unless the companies in Cambodia are able to penetrate the market of the Greater Mekong Sub-region (GMS).

    In this respect, those firms operating out of Cambodia will face stiff competition from their Vietnamese and Thai counterparts. One way is for Huawei and ZTE as well as Smart Axiata to design their future expansion in Cambodia through joint ventures with associated companies in mainland Southeast Asia.

    For Cambodian engineering and technology-based firms, their development and survival will depend on the ability to serve as partners or sub-contractors with the bigger and leading foreign companies as they move into local markets to develop telecommunication infrastructure under investment cooperation in the Chinese BRI framework.

    Scientific Cooperation and Sustainable Development

    Cambodia’s path towards becoming a knowledge-based economy begins with development of the skills base for technology and knowledge-based industries. Enhancing R&D capability is a priority under Cambodia’s National Science and Technology Master Plan 2014-2020 and IDP.

    Given the priorities of the Cambodian government, China’s planned Belt and Road Science, Technology and Innovation Cooperation Action Plan is very pertinent. This plan will consist of providing short-term visits to 2,500 young scientists, train 5,000 foreign scientists, engineers and managers as well as set up 50 joint laboratories in
    the next five years.

    Cambodia harbours a diverse base of natural resources given its geographical position in the GMS. It is necessary to implement policies to accelerate educational and skills development, and to orientate Cambodia’s participation in ASEAN economic and socio-cultural cooperation to create a broad and sustainable foundation for Cambodia’s knowledge-based future.

    Risk Management

    While there is potential for numerous opportunities under the BRI framework, Cambodia should also properly understand potential risks and devise strategies to manage them.

    Information Security

    Information security concerns from using foreign-built telecommunication infrastructure is not new. However, in a changing geopolitical scenario of increasing number of countries developing economic, political and military ties with China, the question is whether Cambodia should let these concerns deprive itself of economic
    opportunities.

    One way to go forward is to enhance the capacity of local authorities to monitor the technical processes of project management as well as negotiate proper terms with their counterparts and businesses in China when projects are being mooted. Examples could include limiting equipment manufacturers’ access to sensitive data, ensuring ownership of patent rights and requiring transparency.

    Environmental, Social and Governance (ESG) considerations

    ESG considerations are often raised when discussing Chinese investments in developing countries. Nevertheless, Chinese investments also allow much flexibility to national governments. Hence, rather than resisting investments, an approach to enhance ESG compliance can be ensured through institutionalising proper frameworks.

    Moreover, there should be due diligence mechanisms within the national systems to conduct proper feasibility and commercial viability assessments of infrastructure projects. The ongoing collaboration of multilateral development agencies with China on sustainable development issues can be extended to build institutional and oversight capacities in developing countries.

    Win-win Situation

    China launched BRI in 2013 to support the development of trade and infrastructure network in partner countries (currently 68) ranging from Europe along Central Asia through Southeast Asia into the Indian Ocean and beyond. Such a mega project serves China’s national interests.

    Firstly, it allows exporting China’s surplus productive capacity to sustain prosperity at home. Secondly, it enables China to establish strategic geopolitical influence in specific regions and states through soft power. Cambodia must identify areas most beneficial to its own interests and capitalise on suitable opportunities.

    While meeting Cambodia’s development goals, strengthening the country’s position in ASEAN — Southeast Asia’s only regional organisation — must also rank as an important objective. Technological advances will raise Cambodia’s development status and give it a stronger voice in ASEAN and beyond. In turn, this will help accelerate Cambodia’s development and progress.

    About the Author

    Prashanta Pradhan is a trade and investment policy specialist advising development agencies and governments, currently, based in Phnom Penh, Cambodia. He holds a Master’s degree in Public Policy from the Lee Kuan Yew School of Public Policy, National University of Singapore. He contributed this to RSIS Commentary.

    Categories: RSIS Commentary Series / Country and Region Studies / International Political Economy / International Politics and Security / Non-Traditional Security

    Popular Links

    About RSISResearch ProgrammesGraduate EducationPublicationsEventsAdmissionsCareersVideo/Audio ChannelRSIS Intranet

    Connect with Us

    rsis.ntu
    rsis_ntu
    rsisntu
    rsisvideocast
    school/rsis-ntu
    rsis.sg
    rsissg
    RSIS
    RSS
    Subscribe to RSIS Publications
    Subscribe to RSIS Events

    Getting to RSIS

    Nanyang Technological University
    Block S4, Level B3,
    50 Nanyang Avenue,
    Singapore 639798

    Click here for direction to RSIS

    Get in Touch

      Copyright © S. Rajaratnam School of International Studies. All rights reserved.
      Privacy Statement / Terms of Use
      Help us improve

        Rate your experience with this website
        123456
        Not satisfiedVery satisfied
        What did you like?
        0/255 characters
        What can be improved?
        0/255 characters
        Your email
        Please enter a valid email.
        Thank you for your feedback.
        This site uses cookies to offer you a better browsing experience. By continuing, you are agreeing to the use of cookies on your device as described in our privacy policy. Learn more
        OK
        Latest Book
        more info