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Tourism Ministry to explore value chain opportunities

Tom Starkey / Khmer Times Share:
KT/Hiezle Bual

The Ministry of Tourism is set to tap into value-chain opportunities as part of the Tourism Capacity Building Project due later this year, after receiving funding from French Development Agency (AFD) last year.

Part of the proposed project, which is predicted to be in cooperation with NGOs or international consultancy firms, will investigate value chain analysis within the agro-food, creative and tourism industries.

The project comes in light of Cambodia’s rapidly growing tourist industry, as it seeks to improve value across the industry chain and improve its future efficiency to better capitalise on the world’s biggest and fastest growing industry.

The World Tourism Organisation (WTO) has said in a report: “Globally, 1.5 billion international tourist arrivals were recorded in 2019, representing a 4 percent increase on the previous year and generating over $500 billion in revenue.”

“This confirms that tourism is a leading and resilient economic sector, especially in view of current uncertainties,” it said. “By the same token, this calls for such growth to be managed responsibly so as to best seize the opportunities tourism can generate for communities around the world.”

Cambodia, which prior to COVID-19 enjoyed a year on year increase of around 10 percent in tourist arrivals and numbering around seven million in 2019, therefore stands as one such country which is seeking to capitalise on opportunities within tourism, resulting in the proposal of value chain research work as part of the TCBP project.

The term “value chain” originated from supply chain ideology, a term first coined by British logistician Keith Oliver in 1982.

Although many of the practical elements of the idea were already in practice, Mr Oliver outlined the methodological framework for the strategy, which suggests that enterprises must analyse their complete supply chains in order to run their businesses more efficiently.

He describes a supply chain as “consisting of two or more legally separated organisations linked by material, information or financial flows”.

“These organisations may be firms growing produce, manufacturing products, parts, components or end products, logistic service providers and even the customer themselves,” he said.

While supply chain analysis is concerned with overall efficiency, value chain analysis encapsulates a more comprehensive approach which aims to create value across the supply chain and beyond for its customers.

The Ministry of Tourism has stated that the TCBP project will aim to perform a series of actions which will help create value within existing tourism chains in the Kingdom.

The activities would include “Reviewing and collating previous tourism studies in Cambodia, identifying the main tourism, agro-food and creation industry value chains that offer

better opportunities to local secondary and tertiary markets and research into how better to exploit those opportunities.”

The ministry also aims to map complete stakeholder analysis chains, in order to closer examine power structures, market chains, SME’s and MSME’s. By carrying out these actions, it says it hopes to remove barriers within value chains in tourism and build further capacity within the industry.

The Ministry also said that any organisation or consultancy involved in the project would be required to sign a statement of integrity, eligibility, social and environmental responsibility.

As yet, the value chains analysis project is still out for tender. However, news of the project has been well received by local business owners catering to tourism in the capital.

Stephan and Matilde Dupont, owners of a newly-opened restaurant Electric Kitchen on Street 308, said they welcome the project because although they try to buy as environmentally-consciously and locally as possible, it is difficult.

“We usually buy our produce from local markets, such as Silep market on street 57”.

Mr Dupont then shows me some avocados that he had just bought that morning, which look incredibly fresh.

“I don’t know which province the produce comes from, but the sellers show us pictures and tell us they come direct from organic farms,” he said. “Unfortunately, we have to buy some products from abroad. For example, we import our flour from Europe and beef from Australia. However, we would like to buy more products as environmentally-consciously and sustainably as possible. Our customers appreciate that we do buy the majority of our food locally.”

“A project which would help us map out our supply chain would be really useful, as an SME running the business ourselves, we don’t have time to research into our supply chains which is a shame. “In Australia, they have a harvest guide book, which tells you the harvesting periods of most vegetables and where they are grown in the country. Something like that would be really useful in Cambodia, and allow us as a business to consume local, eco and organic produce,” he added.

Ministry of Cat Cafe owner, Adolfo Perez-Gascon, agrees that he would welcome any research that adds transparency to supply chains in the Kingdom.

“The biggest difficulty for us is finding suppliers for certain products, especially things like packaging and pet products.”

“We would like to buy more eco and local products where possible. Our customers would also appreciate it.”

“An online platform to connect my business with producers would be ideal. The initiative to map out value chains sounds like a good idea, especially for SME’s like us. We welcome anything which mutually benefits us and the suppliers.”

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