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Phnom Penh getting lion's share of international aid; coordination needed

Phnom Penh getting lion's share of international aid; coordination needed

I NTERNATIONAL donors have spent $1.3 billion in Cambodia in four years - though the

spending has been largely uncoordinated, and most has gone to Phnom Penh.

The imbalance could lead to more "poverty and social inequality", according

to a report this month from an all-encompassing NGO working group.

The group was also worried that Cambodia is having to borrow - rather than be given

- more and more of its aid money.

This "may lead Cambodia into an irreversible debt trap," the group says.

The draft report, from the ten-member "Working Group on Development Assistance"

based on recent statistics from the Cambodian Development Council (CDC) and UNDP,

points to how NGOs and international donors will have to redefine their roles in

Cambodia.

It says, for instance, that of the $432 million aid given to Cambodia in 1994-95,

the biggest share going outside Phnom Penh went to Battambang - at just two percent

of that total.

Other provinces were Kompong Speu (1.9 percent), Siem Reap (1.5 percent), Kompong

Som (1.4 percent), Takeo (1.3 percent) and Kandal (1.2 percent). All other provinces

got less than 1 percent each. Some got nothing.

The report notes that while NGO activities are visible all over the country, "the

geographical imbalance of development assistance is a source of real concern".

The concentration of money in Phnom Penh was due to security concerns in some provinces,

and because infrastructure development was concentrated in the capital.

"Unfortunately, a central focus of NGO work [into rural development]... has

not received the same attention from bilateral and multilateral donors," it

said.

In May, the Government and UNDP tried to coordinate aid, holding regular meetings

about the National Program to Rehabilitate and Develop Cambodia (NPRD). The report

says that effort was "well justified" and "most welcome".

The report points out the Cooperation Committee for Cambodia (CCC) has been asked

to take part in ICORC and UNDP-sponsored donor meetings. Ample opportunity now existed

for NGOs to become more involved in aid coordination on international, national and

provincial levels, it says.

The report notes that aid money has increased every year since 1992. In the last

year, however, grants rose by five percent, while loans increased 58 percent.

"The cost of debt represents a heavy burden on the national budget," it

said. Almost a quarter of the 1995 GNP was for debt repayment on loans Cambodia took

out from Socialist bloc countries before 1992, CDC/UNDP figures show.

NGOs had to develop closer working relationships with the CDC and the UNDP, the report

concludes, and to improve aid coordination. Large capital development projects had

to be monitored and critiqued - and here the European Union's $80 million program

and the Mekong River development were specifically mentioned as causing "concern".

Statistics showed that of the $977 million pledged by multilaterals in the four years

to 1995, only $380 million - or 39 percent - had actually been spent.

Bilateral donors, on the other hand, pledged $1,312 million in the same period and

actually gave $967 million. Japan, for instance, spent more money ($395 million)

than the World Bank, ADB, UN agencies, IMF and European Union did combined.

"While donors rationalized that Cambodia lacked absorptive capacity they failed

to center their programs on, and direct more funds at, capital development,"

the report says.

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