The World Bank Poverty Assessment, released on February 8, says Cambodia has made
progress in ameliorating poverty over the last decade and will, if able to overcome
some key obstacles, meet the Millennium Development Goal of halving poverty by 2015.
"No survey anywhere is flawless, but this one is good," said Tim Conway,
World Bank Poverty Specialist. "This is probably the best survey Cambodia has
Prime Minister Hun Sen, speaking at the launch of the report, said that since 1994
there has been a decline of at least 1 percent per year in the number of people living
below the poverty line.
"This assessment can help to clarify the misconception by some members of the
international community that Cambodia's rapid growth over the past decade did not
contribute to poverty reduction in the country," he said.
Overall growth rates in Cambodia over the last decade have averaged an impressive
7 percent per annum. To a certain extent, this economic performance is explained
by the emergence of peace and stability:
"If you take the weight off an economy, if a situation of conflict ends, then
you would expect to see growth. But the question is 'What are you going to do for
the next ten years?' What drove growth over the last decade might not be what drives
it over the next," Conway said.
Equipped with the World Bank report, the government will be better able to determine
the future direction of Cambodia's economic development, said Nisha Agrawal, World
Bank Country Manager:
"For too long Cambodia has been trying to formulate poverty reduction policies
and strategies without good data on national trends and patterns in poverty,"
The World Bank Poverty Assessment draws on a number of sources using both qualitative
and quantative data to gain an understanding of the dynamics of poverty within Cambodian
"This allows one to ask questions such as, Are 'the poor' the same people from
one decade to the next?" Conway said. "This is very important as 'chronic
poor' are very different from 'transitory poor' and will need different policies
to help them."
Agrawal said identifying policies that could help Cambodia's poorest citizens benefit
more from economic growth emerged as a primary concern for both the Cambodian government
and the World Bank.
"The income of the richest group grew by about six times the rate of the poorest,"
she said. "This has led to a very rapid rise in inequality in Cambodia."
"If Cambodia is to meet its goal of halving poverty by 2015, it will need to
ensure that the poor - including the very poor - benefit more from growth in the
coming decade than they did during the last," she said.
Both the government and the World Bank agreed that Cambodia needs to develop strategies
to ensure a more even distribution of wealth. The inequitable distribution of the
fruits of economic growth has led to increasing polarization along urban/rural and
rich/poor fault lines.
"Significant progress in reducing poverty requires a more pro-rural, pro-poor
pattern of growth," Agrawal said.
In his speech Hun Sen said, "We need to widen the reach so that the poor gain
more from each point of GDP growth. Our first priority is to create conditions that
allow agriculture to grow."
But the report highlights some serious obstacles blocking agricultural development.
"Below-potential agricultural and rural growth can be explained primarily in
terms of poorly defined property rights, inadequate and degraded infrastructure for
water control and transport, and a combination of low levels of human capital and
high levels of household-level vulnerability," the report said.
Hun Sen said that to address these issues the government will focus on resolving
land disputes, building rural infrastructure and improving the quality of education
and affordable health care.
Both the government and the World Bank emphasised the need to diversify the economy:
"[Currently] the foundations of the economic growth are very narrow - garment
manufacture, tourism, and construction," Conway said. "Any problems with
one of these key areas could produce a real shock which would be difficult for Cambodia
to deal with."
The importance of agriculture, however, was the central message of the poverty assessment.
"Industry and services do matter, but, at the moment the case must be made overwhelmingly
for agriculture. The vast majority of Cambodia's poor are farmers. Over the next
five years if we are to reach the poor we need to do something about agriculture,"