on Danish Environmental Assistance to Cambodia Council for the Development of Cambodia, Phnom Penh 23-24 April 2001
AGREED MINUTES |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
1.
Introduction
The second bilateral annual consultations on co-operation between Cambodia and Denmark were held in Phnom Penh on 23 April 2002. The Cambodian delegation was headed by H.E. Mr. Keat Chhon, Senior Minister of Economy and Finance and 1st Vice Chairman of the Council for the Development of Cambodia (CDC), and the Danish delegation by Mr. Einar H. Jensen, Head of Department of the ASEAN, Ministry of Foreign Affairs (a list of participants is enclosed as Annex I). 2. Opening Statement Opening the talks, the Head of the Cambodian Delegation welcomed the Danish Delegation. He praised the opportunity to further strengthen the partnership for cooperation and looked forward to the consultations. He stressed the need to improve the conditions for Cambodia and especially to alleviate the poverty by linking them to effectively and efficiently management of the natural resources and environment. He mentioned that the recent Commune Council elections were a major step in strengthening democracy at the grassroots level and in the efforts to decentralize the Government and empower the people to take charge of their own destiny. The Government was overall satisfied with the relative peaceful process and the following debate leading up to the national elections next year. The Danish support to activities related to the decentralizing process would contribute to the success and strengthen the democracy at grass root level. Focusing on the reform process he was confident that the maintenance of the momentum was a key to pull Cambodia from the vicious circle of poverty to its rightful place in the international community. The Government was therefore reaffirming the commitment and political will to pursue the reforms regardless of difficulties and challenges. In his opening remarks the Head of the Danish Delegation thanked for the kind welcome and commended the Royal Cambodian Government for the positive results of the joint environmental co-operation in the 5-year Natural Resources and Environment (NRE) Programme supporting Cambodia in its efforts for a sustainable use of natural resources and protection of environment. . He then mentioned the joint Annual Project Review (APR) and focussed on the main findings of the APR team especially he was pleased to note the fact that the NRE Programme is well managed and has achieved good progress. He also took note of the recommended programme for 2002, which is quite in line with the Government's policy with regard to decentralization and poverty alleviation. He emphasized that lasting improvements in the living conditions of the poorest sections of the worlds population is the overriding objective of Denmark's development policy. Besides the benefit to Cambodia from the bilateral co-operation he also stressed the continued Danish support to the 2 regional institutions, Asian Institute of Technology for more than 30 years and the Mekong River Commission for more than 10 years, from which Cambodia is also benefiting considerably. 3. Danish development assistance strategy and priorities, development assistance budget reductions, etc. The head of the Danish delegation gave a brief overview on the Danish Government's development co-operation policy. He informed that the Danish Government placed great emphasis on poverty reduction, economic growth, good governance, democracy and human rights. Based on these criteria the Government had, as part of its budget proposal for 2002, conducted a critical review on the Danish development and environmental assistance to developing countries. That had led to a general reduction by approx. 12 percent in the assistance to all co-operation countries. The Government will continue the reorientation of development and environmental assistance. The results of this will appear from the 2003 Finance Bill, which is expected to be approved in the second half of 2002. He confirmed that Denmark with an ODA of around 1 per cent of GDP in 2002 will still be in the forefront of developed countries with regard to the provision of ODA and the new Government's policy is to maintain this position. As a consequence of the review the frame for environmental assistance to Cambodia in 2002 was reduced from DKK 67 to 40 million. The decision on how to cut the assistance was based on an evaluation of the co-operation of the individual countries. The head of the Danish delegation commended the smooth co-operation in the implementation of the environmental activities and the significant results achieved in spite of the limited capacity of the authorities and in periods of political unrest. He stressed that due to the limited absorptive capacity it was necessary to focus the assistance on fewer activities and in a smaller geographical area than originally planned as it was reflected in the report from the Annual Programme Review. He stressed the objectives for the Danish environmental assistance and informed that in the future, this will be concentrated on promoting sustainable development through poverty-oriented economic growth with an increased emphasis on promoting the role of women in the assistance. Denmark will continuously remain among the very foremost countries in the world with respect to poverty reduction in the developing countries. He informed that Denmark follows closely the general economic and political developments in Cambodia both bilaterally and through the multilateral Consultative Group Meetings. In the upcoming Consultative Group Meeting in Phnom Penh in June this year, Denmark will look forward to you sharing the contents of your progress reports with regard to economic and fiscal reforms, administrative reform, demobilization and forestry policy reform and all the other parts of the reform programme. In this connection he stressed that partner governments will have to take responsibility for their own development of which an efficient poverty oriented national strategy is an expression. This also applies in relation to respect for human rights, democracy, transparency and good governance. Finally the Danish side informed that a number of projects and NGOs aimed at strengthening the overall standing of fundamental human rights in Cambodian society have received Danish support. Also activities related to accelerate and consolidate the development of the Cambodia democracy have been supported. In 2001 the Royal Danish Embassy was a major donor (USD 313,000) to the National Election Committee (NEC) through the UNDP Trust Fund in order to facilitate the Cambodian local elections in February 2002. Furthermore, Denmark has given support to organizations concerned with documentation related to the Khmer Rouge period and the Khmer Rouge tribunal, rule of law and freedom of expressions. 4. Political and Economic Developments in Cambodia The head of the Cambodian delegation briefed the meeting on the progress of the comprehensive reform program that Cambodia and the RGC has embarked on. He added that the speakers had prepared background papers, and that the time today would mostly concentrate on discussions. The years 2001 and 2002 represent a period of consolidation in the implementation of Cambodia's policy reforms and social development agenda. The 2nd Socio-Economic Development Plan 2001-2005 (SEDP II) and the Poverty Reduction Strategy Paper (PRSP) outline the strategies and policies for achieving these goals. The SEDP II, which was adopted by the Council of Minister in December 2001, reflects this commitment. The Government's poverty reduction strategy embodied in SEDP II has three main components: It was noted that the Danish assisted NRE Programme is a pioneering effort among donor initiatives directly linked to the third pillar of the SEDPII. In respect of private sector development, the head of the Cambodian delegation informed that the RGC considered the private sector an important partner in development. There 'was a regular six-monthly forum held with the private sector, chaired by the Prime Minister and participated in by the entire cabinet - to discuss relevant issues in this regard. The head of the Danish delegation expressed overall appreciation of RGC's reform initiatives, and expressed his appreciation of the prominent role that natural resources and the environment have in the SEDP II, and hoped that this would also be the case during the PRSP process. The two sides agreed that the next year is critical for keeping the reform momentum for the benefit of the poor, although it could challenge vested interests. The head of the Danish delegation urged that the dialogue between UN and RGC on the KR trial to be re-established, and secure that the KR Tribunal comes into effect with appropriate adherence to international standards of justice. The head of the Cambodian delegation assured that the Royal Government of Cambodia remained committed to the process. He further informed that the Prime Minister of India, in a recent visit to Cambodia, has offered assistance to the KR tribunal in form of Indian judges. Decentralization and the Recently Completed Commune Elections The Danish delegation congratulated the RGC for the successful commune elections but expressed concern of the reported violence. The Cambodian side informed that the violence was less compared to previous elections. The Cambodian delegation reported about the status of establishing and internalizing appropriate legal, administrative, fiscal and supervision mechanisms for the newly created rural and urban commune councils. The enabling legal framework for the Commune Councils are being worked out, and eight documents have so far been finalized, mainly relating to financial management and local level planning. Total number of 1621 commune councils have prepared and endorsed their internal regulation / working procedures or rules. At the end of April this year, commune councilors and its clerks will be finishing their orientation on decentralization and management of commune administration. During the next two months, efforts will be concentrated on capacity building of the commune councils, related to management especially finance and planning. The Cambodian delegation noted that these are built on lessons learned in the Seila programme, the Government framework to implement de-concentration and decentralization reforms. The Ministry of Interior is working closely with the Seila Task Force to design, coordinate and support all above training / orientations. In 2002, national budget and Seila's resources have been allocated and contributed to the commune fund. For 2002, only 500 communes will receive funds for development, but this number will be increased every year. The future of the Seila Programme is that it will be fully integrated into the decentralization process, and the procedures developed are being adopted in the regulatory framework being prepared for commune councils. The RGC is facing shortages in technical and financial capacity to implement decentralization policy and local governance. Donor assistance is needed to make this first ever process of local democracy a success. Regarding forest land, which is excepted from the general mandate of natural resource management of the Commune Council, the Cambodian delegation explained that as the main forest areas were protected areas and Concession management areas, these were found to be best managed centrally, with standard regulations, etc., also in view of the need for clear management responsibility. Public Expenditure Management The Cambodian delegation informed that fiscal performance in 2001 has broadly been good, with improved revenue mobilization and expenditure restraint. The 2001 Budget was implemented cautiously to make room for financing the commune elections and to reach the targeted fiscal balance. Moreover, increased spending on flood relief in 2000 has had a major impact on the financing situation in 2001. Domestic tax revenue increased modestly compared to 2000. Overall expenditure has been contained below targets, thus contributing to the avoidance of domestic financing. Although progress has been achieved in reorienting government spending away from defence and security, social sector spending has remained short of expectations. Capital expenditure increased by 4 percent. Overall, inflation was minimal and exchange rate stable. For the year 2002, the main focus of the budget will be on financing the Public Administration Reform. !he Danish delegation expressed strong support for the efforts to direct revenue spending towards the social sectors, and stressed the importance Denmark attaches to the fight against corruption. Denmark stressed that it would follow initiatives in this regard closely. In response, the Cambodian delegation explained that substantial progress in combating corruption had been achieved. The cracking down on illegal logging, the increase in tax revenue, the removal of ghosts from the army, the confiscation of land sold off illegally, and the establishment of the National Audit Authority now in process of becoming fully operational - are among the measures undertaken, which substantially contribute to fight corruption. Reforms in Natural Resources Management The Cambodian delegation informed about progress in the forestry reforms, with the most important milestone being the new Forestry Law, considered by some legal practitioners to be the best in Southeast Asia. The final draft of this Law is currently in the National Assembly and is expected to be adopted soon.
The Danish delegation referred to the sub-decree on Community Forestry, and asked about plans for making this operational as an effective instrument of empowering local communities in management of natural resources. The Cambodian side informed that a Task Force established by the Secretariat of the National Steering Committee to Manage and Execute the Forest Management Policy had drafted a sub-degree on community. It is expected that this sub-degree, after the on-going extensive consultations with all stakeholders arc completed, will be issued within the next few months. The major challenges to forestry reform are associated with the sustainable management of forest concessions and the strengthening of programs to combat forest crimes. In this regard the Danish delegation asked about the status of the Sustainable Forestry Management Plans (SFMP), which were to be submitted by all concessionaires by September 2001, and the current status of the Forest Crime Monitoring and Reporting Project (FCMRP). The Cambodian side informed that the deadline for submission of mandatory long-term strategic forest management plans by concessionaires, consistent with international standards, was extended to September 2002. However, all logging activities was suspended by the RGC from 1 January 2002 until such time that SFMPs have been submitted and approved. If not complied with the concessions will be cancelled. Out of the present 17 concessions, eight concessionaires have submitted SFMPs, currently under review. The Cambodian delegation informed that the incidences of forest crime continue to be reduced. The Forest Crime Monitoring and Reporting Project had experienced several setbacks. In an effort to strengthen the effectiveness of project implementation, the DFW has introduced important initiatives, presently being discussed among all involved. It was agreed that the efforts to complete the process of reform in forestry is of utmost urgency, with significant challenges remaining, that can only be overcome with cooperation among all involved parties, including the continued support and understanding of the donor community. The Cambodian delegation informed that the fisheries resources have been declining due to environmental degradation, over-fishing and population growth. Seeing the importance of fisheries to the livelihood of the people in Cambodia and the decline in fisheries resources, fisheries management has been a major concern of the RGC. The government has taken several important steps to reform the fisheries sector, including: Revision of the Fisheries Law, establishing Community Fisheries, fisheries conservation, institutional strengthening, administrative reform, and enhanced enforcement of the fisheries law. The establishment of fishing communities will provide opportunities for communities to participate in, and benefit from, sustainable fisheries management. So far, 217 fishing communities have been established and more are to be organized. However, the staff of Department of Fisheries lack experience, human resources and financial support to carry out the huge undertaking. Technical and financial support to the community fisheries development and management are urgently needed. The Danish delegation inquired about status of the legal framework needed for sustainable community management of the inland fisheries. In response the Cambodian delegation informed that a sub-decree on community fisheries was drafted with extensive consultation, and recently approved by the Ministry of Agriculture, Forestry and Fisheries (MAFF) and submitted to the Council of Ministries for approval. However, external support is still needed, especially technical assistance. The Danish delegation noted that important work on inland fisheries is carried out under the Mekong River Commission, funded by Danida. It was urged that opportunities for collaboration and support should be explored. The Cambodian delegation informed about the reforms within Land Management, and started by outlining the three main objectives of the RGC on Land Policy are: (i) Strengthening land tenure security and land market and preventing or resolving land dispute; (ii) the management of land and natural resources in an equitable sustainable and efficient manner; and (iii) promoting land distribution with equity. In order to achieve these objectives the RGC will: (i) develop land use plans for priority areas including tourism and investment zones, key urban areas and major road corridors; (ii) co-ordinate land use plans with natural resources management; (iii) ensure harmonization of the regulatory framework for fisheries, coastal zones, waterways and mineral deposits; (iv) decentralize land management and planning authorities to the local level, after the establishment of national land use guidelines and supervisory structures; (v) develop procedures for urban land management and re-settlement. In light of the proposed Danish support for land use planning in 2003, the Danish delegation asked about the status of the World Bank assisted Land Administration and Management Project (LMAP), and possible focus areas for Danish support. Especially in view of the absorptive capacity of the Ministry of Land Management, Urban Planning and Construction (MLMUPC).
It was agreed that Danish support for land use planning would be concentrated on the components of institutional development and land management, especially at the provincial level. The head of the Danish delegation thanked for the comprehensive overview provided on the progress in the reform within Natural resources and Environment. 5. Natural Resource and Environment Programme The status of programme activities (summarized in Annex II, Programme Overview /Financial Balance) and the report of the Annual Programme Review (APR) undertaken in February/March 2002 were considered. Both parties expressed satisfaction with the co-operation programme ~ noting that the APR had found that it had been well managed and had achieved good progress. Total grants approved to date amounted to DKK 141,3 million, of which DKK 96 million (USD 11.3 million) was approved in 2001 against the expected commitment of DKK 74.5 million considered at last year's consultation meeting. Three of the four components of the Programme were now substantially operating, giving the Programme a wider front for support of Cambodia's initiatives in sustainable management of natural resources. As an increasingly active partner to Cambodia's efforts in this regard, Denmark infonned that it would welcome taking a more active or a lead role, if appropriate, in co-ordinating donor support in selected issues in natural resources management. Denmark emphasized it was, in principle against counterpart staff incentive payments, as such measures are not sustainable. Denmark underlined the need to phase out these payments as soon as possible, latest by the end of the present phases of on-going programmes/projects. There was urgent need for salary reforms for the civil service in order to make public administration as efficient as possible, and to eliminate the distortion represented by donor-paid salary allowances. The Cambodian side was urged to initiate a dialogue with donors in order to establish a common policy and a concrete plan for phasing out salary allowances. Cambodia assured that ways to address this issue were being considered at the highest f levels of the Government, admitting, however, that a solution was not easy without the fU1ancial resources. The Cambodian Delegation asked Denmark to consider the phasing out of the incentive payments to be linked with the implementation of the Priority Mission Group concept under the public administration reform, as requested by donors. Nonetheless, the Cambodian delegation assured its appreciation of and respect for Denmark's policy on this matter.
For funding in 2003, subject to approval of the 2003 Finance Bill, it was agreed by both Parties to give priority to the preparation of the planned support to land use planning and management. A formulation mission may be fielded in late 2002 in this regard. Considering the limited funding, it was agreed to defer, for consideration of the Annual Programme Review in 2003, the proposed funding window for NGO/CBO projects. The updated Summary of Component Activities (23 April 2002 Update of Table 6, NRE Programme Document 2001-2005, enclosed as Annex V) was accepted as reflecting the current status of the programme implementation and development. A summary of the key issues discussed and agreed actions to be undertaken in respect of the four components of the Programme is given below. Details on status of individual projects are given in the Project Status Overviews enclosed as Annex VI. Capacity Development. Environmental Education and Monitoring The DKK 49.9 million National Capacity Development Project, the principal project under the component, commenced activities in December 2001, completing its mobilization and inception phase in March 2002. A core project within the overall NRE programme, the project involves the main national partners of the other components, and includes funding for NRE programme coordination and the operation of a Danida office in Phnom Penh. The development of a monitoring and evaluation system for the NRE Programme in collaboration with CDRI has been funded by Danida, and pilot activities on environmental education and awareness raising have been initiated under the Embassy's Local Grant Authority. The Danish side underlined the need for strong inter-ministerial co-operation for the successful implementation of the National Capacity Development Project, and encouraged the active co-operation of national partners with CDRI in the design and implementation of a feasible monitoring and evaluation system for the NRE Programme. It was agreed by both Parties to suspend planning of further activities under the component this year. Land Use Planning Recently two activities were approved under this component, i.e. the third phase of the Coastal Zone Management Project (DKK 26.95 million), and the Watershed Management Project in Kbal Chhay (DKK 16.9 million). Both projects are in tender and expected to commence activities in August 2002. Initial dialogue has been undertaken with the Ministry of Land Management, Urban Planning and Construction (MLMUPC) on a broader support to participatory land use planning in the coastal and lower Mekong regions of Cambodia. The ongoing Phase 2 project on Coastal Zone Management (CZM) is progressing more or less according to plan, and has been extended to 31 July 2002 within the original approved funding to secure continuity and smooth transition to Phase 3. The Cambodian delegation reported on progress made in strengthening the Coastal Coordinating Unit (CCU) within the MOE, following the recommendations of the CZM Project Review undertaken in September 2001. Initiatives to reform the CCU . have been undertaken. As planned and underway, four permanent CCU staff will remain working for CCU including the National Coordinator. Six staff, called Resource Persons, from different involved departments in MOE, will be assigned ad hoc to CCU to support its operations. In addition, the existing National Focal Point system will also be used on an ad hoc basis to assist CCU in its functions. A training needs assessment for CCU based on the mandates of the NCSC, PWGs and the CCU is to be undertaken. For the land use planning and management project, to be prepared later this year, the Cambodian delegation proposed support in the areas of institutional development, and land use management - linked to and complementing the Government's intiatives in land management and administration. Urban, Industry and Energy Environment No activities have yet been started under this component; the planned pilot project on solid waste management has been formulated and appraised. Due to the reduced funding frame for 2002, however, and considering other priority projects in the pipeline, it was agreed to defer implementation and further preparation of the solid waste management project, as recommended by the APR. Natural Resource Management (NRM) Activities under the component comprise: (i) the DKK 14.63 million Integrated Pest Management (IPM) Farmer Training Project implemented by the Ministry of Agriculture, Forestry and Fisheries (MAFF), and (ii) the DKK 4.8 million Community Forestry Project implemented by the international NGO Concern Worldwide in cooperation with the Ministry of Rural Development and Ministry of Agriculture, Forestry and Fisheries/Department of Forestry - both expiring this year, in August 2002 and June 2002, respectively. It was agreed to extend these two projects until end December 2002 within the original project grants, pending appraisal and approval of the second tranche of the NRM component support. Appraisal of the next tranche of the component support is scheduled in May/June 2002. Activities to be appraised will include (i) a second and final phase for the IPM project; (ii) a second phase for the community forestry project, and (iii) support to Seila NRM mainstreaming. In view of the limited funding available for 2002, consideration of the Cambodian component of the IUCN/GEF /UNDP Mekong wetlands biodiversity project, and the Inventory and Management of Cambodian Wetlands project proposed by MOE (phase 2 of an earlier project funded via MRC) was deferred until adequate funds, necessary priorities and a tangible design and formulation of the present project proposal had been made available and worked out in detail. With reference to the planned expansion of CONCERN's community forestry programme in Cambodia, Denmark stated its support for the selection of one of the Lower Mekong provinces as target area for expansion of its activities under the Danida support. In response to Denmark's query on the progress of the Forest Crime Monitoring and Reporting Project, and the current and envisaged future role of Global Witness in this, Cambodia referred to the recent FAO backstopping mission, which made various recommendations for improved operation of the project. There is need for the key stakeholders RGC, Global Witness, FAG, UNDP, World Bank and DFID to agree to a way' forward. It should be possible to identify areas where agreement can be reached, park areas of disagreement, and conclude whether there is an acceptable way forward for the project. Cambodia assured that the Ministry of Agriculture, Forestry and Fisheries would cooperate fully with Global Witness. Denmark looked forward to the early successful resolution of pending issues, and informed that Danida would be liaising closely with DFID, in this regard. Possible integration of follow-up activities to the current Cambodian Tree Seed Project, funded under the regional Mifresta frame, and which can be seen as an important contribution the forestry sector within the NRM component was considered. Denmark encouraged continued cooperation between the Regional Tree Seed Project and activities under the NRE Programme, and stated readiness to consider integration of future activities in Cambodia of the regional project into the NRE Programme, if appropriate, and in line with Programme priorities. The Head of the Danish delegation underlined the importance of having a dialogue on ratification and implementation of international conventions. He welcomed the fact that Cambodia had signed many of the international conventions in Environment. He however took note of the fact that Cambodia hat not signed the Kyoto protocol yet. He expressed hope that Cambodia would sign and ratify it soon. He further stated that Denmark is willing to discuss funding of convention related activities within the budget frame for environmental assistance to Cambodia. Support to Demining operations in Cambodia - CMAC Reference was made to the 5,0 million DKK funding approved in 1999. Due to the findings and recommendations of a external audit the funding was frozen and 4 Danish demands for unfreezing were raised. Based on a recent submission from UNDP the Danish delegation informed that the 4 Danish Demands have been met. The amount will be transferred in 2002 to the UNDP trust fund for CMAC after signature of agreement between the Embassy and UNDP. 6. Other Issues The Danish delegation stated that all financial statements made in these Agreed Minutes were subject to approval by the competent Danish authorities. It was agreed to hold the next round of Annual Consultations in April 2003 in Phnom Penh. |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Phnom Penh, 24 April 2002
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Annex I LIST OF PARTICIPANTS The Government of Denmark:
Annex II NRE Programme Overview/Financial Balance Annex III Proposed Allocation of the 2002 Commitment Frame
The exchange rate: 1 USD is approximately 8.50 DKK
Annex IV Process Action Plan (PAP)
Annex V NRE Programme - Summary of Component Activities
Table 6: NRE Programme – Summary of
Component activities (Draft Update, 23 April 2002) |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Status: April 2002 |