COUNCIL FOR THE DEVELOPMENT OF CAMBODIA (CDC)

4. CONCLUSIONS

58. The Royal Government of Cambodia faces daunting development challenges today. Although significant progress has been made, much remains to be done. The development partners of Cambodia have been generous in supporting Cambodia’s development efforts. The RGC is gratified by the support of its external development partners and hopes that they will continue to provide their support to enable Cambodia to achieve its goal of reducing poverty among its people.

59. The Royal Government is pleased to report that over the last three year, 1999-2001, disbursements have steadily increased from just under US$ 400 million in 1999 to nearly US$ 472 million last year (2001). At the same time, the amounts pledged by donors have also increased significantly – from US$ 526 million in 1999 to over US$ 610 million in 2001. Excluding the year 1998, when no CG meeting was held and consequently no formal pledges were recorded, disbursements over the 1992-97 and 1999-2001 have totaled nearly 3.7 billion dollars – constituting 73.3 percent of the pledges made by donors during these two periods. In more recent years, the ratio of disbursements to pledges has been higher – representing a greater absorptive capacity within the Government. Disbursements have increased from 76 percent of the donor pledges in 1999, to 77.3 percent in the years 2000 and 2001.

60. There are some noticeable changes in the composition of ODA in terms of type and terms of assistance. Overall, the loans component, 26.5 percent of the total ODA, in 2001 was significantly higher than the average of 17.8 percent for the 1992-2001 period. The loans portion of disbursements in 2001 increased by 27.6 percent over the year 2000 level. The increase in the loans portion of disbursements has implications for future national budgets because of the resulting increase in the size of the national debt and related debt service charges. The Ministry of Economy and Finance will be monitoring closely the financing of development programs/projects through loans; and will conduct comprehensive reviews of development programs/projects proposed to be financed through loans as an integral element of the prioritization/decision-making process. At this stage of development of Cambodia, the Royal Government of Cambodia places a high priority on securing financing of development programs/projects through grants from Cambodia’s development partners.

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