Foreword 

This document, prepared by the Cambodian Rehabilitation and Reconstruction Board of the Council for the Development of Cambodia (CDC/CRDB), is a compendium of the statements, comments, and remarks that were distributed by representatives of the Royal Government of Cambodia (RGC), bi- lateral and multi-lateral donors, private sector and the civil society during the course of the 6^th Consultative Group Meeting for Cambodia held in Phnom Penh at the CDC in June 2002.

In terms of the process of preparations for the 6^th CG Meeting, pursuant to the Royal Government of Cambodia’s Decision No. 12 dated 11 December 2001, H.E. KEAT CHHON, Senior Minister, Minister of Economy and Finance and First Vice-Chairman of the Council for the Development of Cambodia was mandated to lead and coordinate the preparation of the 6^th Consultative Group Meeting for Cambodia to be held in Phnom Penh, by using the existing structure of the CDC/CRDB in which H.E. CHHIENG YANARA is the Secretary General.

After being authorized by Samdech HUN SEN, the Prime Minister, CDC/CRDB started work on preparing the Royal Government’s Position Paper in January 2002. During the course of the preparation process, CDC/CRDB convened two inter-ministerial meetings, on January 17 and April 09, 2002, and bilateral discussions with sectoral ministries/agencies were conducted on an on-going basis. CDC/CRDB also received inputs from the Supreme National Economic Council (SNEC). In addition, a meeting with the donor community, civil society and the private sector was held on April 25, 2002 to review and seek comments on the draft of the Position Paper. In addition to seeking their comments, one other purpose of this meeting was to enable the donor community to provide information to their country’s capitals about the progress and priorities of the Royal Government of Cambodia.

The Government’s position paper entitled Socio-Economic Development Priorities and the Official Development Assistance Needs together with ODAlinvestment Programme for Aid Mobilization is based on: (i) speeches of Samdech HUN SEN, the Prime Minister at various meetings, in particular those made at the National Forum on Governance Action Plan (GAP), the semi-annual meeting between the RGC and donor community, and at the meetings of the Government-Private Sector Forum; (ii) Financial Law on Budget Management - 2002; (iii) sectoral policies and strategies outlined in the 2^nd Five-Year Socio-Economic Development Plan (2001-2005), the Poverty Reduction Strategy Paper (PRSP) and the 3-year rolling Public Investment Programme, 2002-2004; and (iv) submissions, Comments and recommendations provided by the line ministries/institutions. In short, the Government’s Position Paper is the result of a joint effort of the various ministries and agencies of the Royal Government. The Executive Summary of the Position Paper was officially adopted by the Council of Ministers on May 03, 2002. Thereafter, the CDC/CRDB delivered the report entitled Socio ­Economic Development Priorities and the Official Development Assistance Needs in Khmer to the National Assembly and the Senate as a progress report on the RGC’s preparatory activities for the Consultative Group Meeting. The Development Cooperation Report (DCR) for 2001, prepared by CDC/CRDB, was also distributed to the Government ministries/agencies prior to the meeting. In addition, all the donor countries/agencies that attended the CG Meeting were provided copies of these two documents, together with other supporting documents, 2-3 weeks prior to the meeting.

The 6^th Consultative Group Meeting for Cambodia, that was held in Phnom Penh on June 20-21, 2002, was preceded by informal working sessions on June 19^th. These informal meetings focused on four specific topics: (i) Decentralization; (ii) Partnerships and Aid Coordination; (iii) Poverty Reduction Strategies; and (vi), Legal and Judicial Reform. The purpose of the informal working sessions on the four topics was to exchange views among participants on relevant issues and to narrow down the issues for presentation and discussion at the plenary sessions of the 6^th CG Meeting.

The formal meeting was opened on June 20, 2002 under the high presidency of Samdech Hun Sen, the Prime Minister of the RGC. His opening remarks provided a comprehensive picture of the overall progress and achievements of the RGC over the last decade, in particular since the last election in 1998, and highlighted the significant progress that has been made in the implementation of the reform programs to which RGC had made commitments at the 2001 CG Meeting in Tokyo. In his opening remarks, aside from outlining the vision, strategies and policies of the Royal Government, Samdech Prime Minister also reaffirmed the Government’s commitment to implement reform programmes with Good Governance as the backbone to ensure sustainable economic growth that is a pre-requisite for achieving reduction in poverty.

The 6^th CG Meeting was co-chaired by Mr. Ian C. Porter, Director of Southeast Asia and Mongolia Department of World Bank and H.E. Keat Chhon, Senior Minister, Minister of Economy and Finance and First Vice-Chairman of the Council for the Development of Cambodia. The official delegate to the 6^th CG Meeting included, in addition to representatives of the Royal Government, representatives of 22 countries, International Financial Institutions, national and international Non-Government Organization and the Private Sector.

At the 6^th CG Meeting, the external development partners of Cambodia complemented the Government on its progress in achieving macroeconomic growth and fiscal stability and acknowledged that the Government has made progress on the overall reforms agenda since the last CC meeting in Tokyo. In addition, donors emphasized their support for the RGC’s continuing commitment to reforms and encouraged RGC to move ahead with the implementation of the reform programmes by translating commitments into concrete actions in order to ensure sustained economic growth and development to achieve a reduction in poverty among the Cambodian people. They also noted that the implementation of some of the reform programmes especially the legal and judicial reforms have experienced delays.

Based on the RGC’s commitments, the inputs from the various Working Groups under the CG mechanism, as well as informal discussions during the CC meeting, the following nine areas where actions/progress can be jointly monitored were identified in the concluding remarks of Mr. Ian C. Porter, Co-Chairman. Specific benchmarks to monitor the progress in the implementation of the nine areas/elements of the reform programmes have also been prepared. These nine areas/elements regrouped under the relevant RGC’s reform programmes are listed below.

     A.   Legal and Judicial Reform and Governance

1. Enacting key components of legal and judicial reform.
2. Taking visible actions to fight corruption.
3. Extending coverage of the implementation of the Procurement Sub-decree (1995).

     B.   Natural Resources Management

4. Rationalizing the forest concession system on the basis of Sustainable Forestry Management Plans.
5. Strengthening the legal framework for community-based natural resources management.

     C.   Social Sector

6. Improving budgetary disbursements to the social sectors.
7. Implementing declared actions to support HIV/AIDS prevention.

     D.   Fiscal Management and Public Administration Reform

8. Updating the civil service reform plan consistent with the Medium-Term Expenditure Framework.
9. Strengthening revenue mobilization through broadening the collection of taxes and fees.

To further strengthen partnerships between RGC, the donor community, civil society and the private sector to achieve the objective of poverty reduction in Cambodia, at the 6^th CG Meeting it was agreed that a “Government-Donor Partnership Working Group” under the CG mechanism, similar to other Working Group, will be formed. It was also agreed that this Working Group will be chaired by a senior representative of the Government, and Japan as the representative of the bi-lateral donors and UNDP as the representative of the multi-lateral donors will be the Co-Vice Chairs. In response to the decision at the 6^th CG Meeting on the formation of a “Government-Donor Partnership Working Group” under the CG mechanism, on July 10, 2002 Samdech Prime Minister designated the Secretary-General of CDC/CRDB to be the Government’s representative.

The “core” three-year Public Investment Programme (PIP) for 2002-2004 that the Government presented has a total financial requirement of US$ 1,457 million or an average of US$ 486 million per year. Mr. Ian C. Porter, Co-Chairman declared at the conclusion of the 6^th CG Meeting that Cambodia’s development partners have pledged a total of US$ 635 million for the year 2002 against US$ 486 million requested. This is indeed a note of their increased confidence in Cambodia’s progress in moving forward its reforms and development agenda. The US$635 million does not include US$ 50 million pledged by NGOs. The largest contributor of development assistance to Cambodia, Japan, pledged to provide US$ 113 million. While the People’s Republic of China was not in position to make a pledge, it continues to be a significant provider of assistance to Cambodia. To follow on the pledges, the Government will conduct bilateral dialogues with each donor country/agency on specific projects/programmes to be implemented. CDC/CRDB will coordinate this task with donor countries/agencies.

In Summary, the 2002 Consultative Group Meeting for Cambodia witnessed a resurgence of goodwill from the International Donor Community for Cambodia, which was reflected in the substantial level of commitments made. The Government was urged to sustain and build upon this goodwill by taking decisive and transparent actions to implement the reform programmes in order to further Cambodia’s development to benefit its people. Within this framework of Partnership for Development, the Royal Government has committed to do its utmost to implement all the reforms programmes with transparency and accountability, and to mobilize all efforts to translate the CG Meeting recommendations and advice into concrete actions.

It was agreed that the next CG Meeting would be held at the end of 2003 in Phnom Penh.

The Council for the Development of Cambodia takes this opportunity to express its gratitude to UNDP for its assistance in the preparations for the CG Meeting.

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