Logo of Phnom Penh Post newspaper Phnom Penh Post - ADB study marks Cambodia as 7th poorest country

ADB study marks Cambodia as 7th poorest country

ADB study marks Cambodia as 7th poorest country

p15_story3.jpg
p15_story3.jpg

Cambodia one of only two countries in the world where new benchmark basket of goods rises in price, which the bank can't explain

AFP

The current president of the Asian Development Bank, Haruhiko Kuroda.

CAMBODIA is the seventh poorest country out of sixteen surveyed in the Asian Development Bank (ADB) Key Indicators 2008 report, released Wednesday, which also introduced a new way to measure poverty across Asia.

"This is a landmark study," says Ifzal Ali, ADB chief economist.

For the first time, the ADB has used a poverty line that is specifically designed for the Asia and Pacific region - the so called Asian Poverty Line (APL) which stands at US$1.35 per person per day.

The measure also includes a  new Purchasing Power Parity (PPP), called PS PPP.

PPPs are based on comparisons of prices of a selected set of products, ensuring a common purchasing power

Previously the most common PPP was the Consumption PPP, which is based on the cost of about 650 different products from rice to cars in 140 countries all over the world.

To ensure that comparable products could be found in all 140 countries, many of the products chosen were high-quality products.

"The point is that these are not products relevant to the poor", says Rana Hasan, ADB Senior Economist and one of the authors of the report.

The ADB study used a PPP defined by the products the poor would buy, (lower quality products in smaller quantities) in order to better compare poverty across countries.

The new PPP, called PS PPP, uses prices collected by special "poverty-specific" price surveys carried out in the 16 countries.

"In our opinion the best way to compare poverty [internationally] is the PS PPP," said Rana Hasan.

The report, which is based on numbers from 2005, shows that the number of poor drops when using the new PS PPS compared with the old Comsumption PPS using the new Asian Poverty Line - except in Laos and Cambodia.

In Bangladesh the percentage of poor drops from 58.2 percent using the Comsumption PPP to 42.9 when using the new PS PPP. In Laos and Cambodia the percentage goes up using the PS PPP.

Local prices rise

In Cambodia it increases from 35.4 percent to 36.9 percent or 5.06 million people.

 The ADB has no explanation for this.

"I want to make clear that we are not saying that the poor in Cambodia pay more than the not poor people.

"The poor are still paying less but not that much less," says Rana Hassan, mentioning a low range of quality products, or that the poor buy more of the same products as the not poor people as other posible explanations. 

MOST VIEWED

  • Former opposition leader tells soldiers, Cambodians to unite to fight CPP

    Former Cambodia National Rescue Party (CNRP) President Sam Rainsy has called for a popular uprising after the July 29 national elections to force a change of government. He called on the armed forces and people to stand united to fight the ruling Cambodian People’s Party-led

  • Bun Heang mocks US, threatens its citizens in scathing open letter

    After being hit with sanctions from the US Department of Treasury, Cambodian General Hing Bun Heang said he would retaliate against any US national who does not respect his country’s sovereignty, has ambitions to invade Cambodia or incites “traitors” in the Kingdom to do

  • Police warn boycott FB group involved in the “Clean Fingers Campaign”

    Police said on Tuesday that they will pick up members of a Facebook group involved in the “Clean Fingers Campaign” that promotes a boycott of next month’s national elections. However, police merely planned to “educate” the group for now, but warned that if the

  • Prince injured, wife dies after accident

    THE wife of former First Prime Minister Prince Norodom Ranariddh, Ouk Phalla, 39, died while the prince was “severely” injured following a road accident in Preah Sihanouk province’s Prey Nub district on Sunday morning, officials said. Rananriddh, who is also the president of the Funcinpec