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Economic data: a familiar story emerges

Economic data: a familiar story emerges

YOU'VE heard it a hundred times, but these graphs produced by the Ministry of Finance

and Economy probably are the most eloquent descriptions of Cambodia's economic management.

Graph A shows that almost half the national budget goes towards the military and

defense sector - almost twice as much as the health, education, environment, social

affairs and women's affairs sectors combined.

Dr Lao Mong Hay, of the Khmer Institute of Democracy summed it up in a few words.

"It is morally wrong to allocate scarce national resources very disproportionately

in favor of national defense and security, and very little to public health, social

affairs, and environment," he said. "They should cut the defense budget

in half, and allocate that money to the public health sector."

Even the Minister of Finance himself, Keat Chhon, was a little red-faced about the

figures at the recent donor/government meeting.

"The public expenditure results are less than encouraging," he admitted

in his report.

A study produced by the Ministry of Planning as background to the government/donor

meeting certainly backed that point of view; the graphs to the left were attached

as appendices. The report noted that: "Cambodia's level of health infrastructure

and health manpower is simply inadequate by any comparison."

Dr Lao raised an eyebrow at Graph C, which details the general administration budget.

In this, the Royal Palace receives about four times as much money as the Ministry

of Justice.

"The Royal Palace is expensive," he said. "Our government puts stress

on the rule of law, they say that they are concerned about this. But look at the

money they allocate to Justice - it's too little."

Actual disbursement versus allocation is also an eye opener. Public works and transport,

in graph B, received the highest allocations under economic administration - around

44 billion riel - but has so far this year received an allocation of just 5 billion

riel. Keat Chhon outlined various disbursement problems in his October 27 report,

admitting that spending on priority sectors (Health, education, agriculture and rural

development) fell short by 19% in September.

But according to the ministry, the year 2000 budget contains steps to improve expenditure

disbursement, including the memorably named PAP (Priority Action Program), which

ensures that "even during revenue shortfalls, allotments to priority programs

will not be cut", and PEP (Public Expenditure Program), which links medium and

long term development objectives with short term objectives.

And there is the welcome news that the 2000 budget has finally shifted priorities

towards the social sector. The education budget has increased by 39%, the rural development

budget has doubled, the agriculture budget has climbed by 11%, and the health budget

has increased by 51%,

Just as well, says Dr Lao.

"I'm very strongly in favor of allocating more resources to public health,"

he said. "The rich can afford to go to private clinics - but the poor, they

have nothing. The government needs to rationalize its spending."

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