The country's three-year plan to combat poverty, known as the National Poverty Reduction

Strategy (NPRS), was approved by the boards of the World Bank and the International

Monetary Fund (IMF) on February 19 and 20 respectively.

The approval means Cambodia will continue to qualify for concessional loans from

the two institutions. On March 3 the government will formally launch the NPRS, which

covers the period 2003 to 2005.

Steven Schonberger, senior operations officer at the World Bank, said the assessment

by staff from the Bank and the IMF was undertaken to determine whether the NPRS would

provide a credible way to combat poverty.

"[The NPRS] provides a reasonable basis for reducing poverty, but the joint

staff assessment points out some real risks," Schonberger said. Among those

risks were governance issues, the need for judicial reform, and a lack of capacity

in monitoring the program's success.

The Bank's assessment noted that one strength of the plan was that the government

had consulted widely with the public, NGOs and the donor community. Another was improved

coordination between the government's poverty secretariat, the GS-CSD, and the different

ministries.

But among the major risks in implementing the plan, it said, were weak capacity in

the civil service, and a slowdown in the world economy. The assessment warned that

could damage the prospects for economic growth required to meet the poverty reduction

targets.

The government aims to cut the poverty rate from around 36 percent of the population

to 19 percent by 2015. Kim Saysamalen, an under-secretary of state at the Ministry

of Planning (MoP), heads the GS-CSD. He is confident the government can achieve that

goal.

"We believe we can, and we have experience in the past," he said. "Between

1994 and 1997 poverty reduced from 39 percent to 36 percent with no [formal] strategy,

and that was with GDP at 4.5 percent."

Saysamalen said that to meet the new goal, the rate would need to drop by 1.2 percent

annually, a slightly quicker rate than was achieved in the mid-1990s. With the formal

strategy and GDP growth of up to 7 percent annually, that should prove achievable,

even if it occasionally falls below that.

He acknowledged that monitoring was key to the success of the NPRS. As part of that

the government will launch its socio-economic survey in March. The survey should

be completed by the end of the year and should indicate if poverty has improved or

worsened.

Saysamalen said other annual surveys at the local level and in line ministries would

provide further information to assist monitoring. The government would try to run

these so-called secondary data surveys through the SEILA program, a commune level

capacity building program.

Russell Peterson, the representative at the NGO Forum on Cambodia, said the NPRS

was largely a reflection of existing plans, which vary in both quality and the participation

of different ministries.

"The NPRS provides a good overview of what the government is intending to do

regarding poverty reduction, which provides an opportunity for monitoring,"

Peterson said, "but what is really important is which areas the World Bank and

IMF choose to become conditions of their new loans. We hope that there can be discussions

and transparency in the selection of those areas."

Peterson said monitoring was always difficult, and given the ambitious nature of

the NPRS, he felt there was a need to focus on key areas that affect the public such

as governance, health and education.

The NPRS process is not without its critics, who blame it as simply another way for

the multilaterals to influence the domestic policies of governments needing loans.

Schonberger said the fact that approval was necessary to continue receiving concessional

loans did not mean the institutions were "holding something over the government's

head".

"The real challenge is to find a way to work with government so that [the NPRS]

isn't simply an exercise [for the government] to meet the conditions for concessional

loans," he said. "That requires a step back and to say to government: What

are the priorities?"