4.4  ECONOMIC SECTORS

4.4.1    AGRICULTURE, FORESTRY and FISHERIES

239.    The RGC’s agriculture sector development policies focus on: (i) the continued implementation of agricultural water policy and expansion from 16.62 percent to 20 percent of rice cultivated areas, (ii) expansion of cultivated areas, ensuring safety of land occupation and land utilization, and preventing illegal and violent land occupation, (iii) promoting the establishment of rural finance to provide the needed credit to farmers for buying agricultural materials, (iv) direct public investments by using external assistance and increasing private sector development and investment in the agricultural sector, (v) strengthening extension services, natural resource utilization  and management, and agricultural techniques to meet the requirement of the domestic market and for exports, (vi) strengthening sustainable utilization of fishery resource and increasing support for investment in agro-industries, animal husbandry and fish raising, (vii) accelerating the pace of privatization of rubber plantations, assisting private investment companies to invest in large-scale rubber production, and encouraging small holder rubber plantation, (viii) promoting application of forestry policies and laws on forest management, and promoting planting of fast growing and higher yield trees for utilization as fuel wood and charcoal, (ix) Stopping and eliminating all illegal fishing activities, and (x) cooperating with local authorities and other competent bodies to stop and prevent illegal activities and strengthening inspection through administrative penalties.

240.    Agricultural sector development targets to the year 2005 include: (i) a continuing focus on food security, especially at community and household level, and reducing poverty in the agricultural sector, (ii) increasing food production, especially rice production and subsidiary crops, (iii) increasing the exports of surplus agricultural products, (iv) improving the quality of agricultural products and increasing the value added by promoting the development of ago-industrial processing to foster the creation of new jobs for rural area, (v) increasing family incomes and reducing poverty by supporting diversified crop production with high yields and low production costs, and (vi) managing the natural resource through regulation and technical measures for sustainable exploitation. 

241.    Expanding Agricultural Extension Services. The expansion of research and agricultural extension services is a key component of the strategy to boost agricultural productivity. Two new institutions, the Department of Agricultural Extension (DAE) and the Cambodian Agricultural Research and Development Institute (CARDI) were established in MAFF with assistance from AusAid, which is continuing support through a Cambodian Australia Agriculture Extension project. Another programs is under discussion with JICA for the establishment of Northwest Agricultural Research and Development in 5 provinces around Tonle Sap Lake. Extension services previously provided by separate technical departments are now being coordinated to meet the specific needs of farmers. In addition, there are 14 functioning research station that focus mostly on rice. These institutions suffer from shortage of funds, lack of equipment and qualified personnel resulting in inadequate research and extension. With assistance from the World Bank, several research station are being rehabilitated and their personnel trained in areas of variety evaluation and applied research. The Government is looking for additional external assistance to ensure the continuance of farmer training in the areas of integrated pest management techniques and the distribution of new varieties of high quality rice seed developed by the Cambodia-IRRI-Australia Project (CIAP). Complementing these measures will be the strengthening of the Department of Planning, Statistic and International Cooperation and the other Technical offices to undertake and disseminate product analysis, identify potential for diversification, market research, evaluate agribusiness ventures and to advice on agriculture trade policy.

242.    Food Security. Cambodia produces more rice than it needs in aggregate. The annual exportable surplus has averaged about 10 percent of yearly rice production. Similarly, there is adequate supply of livestock produce. Despite this food surplus situation, about half the nation’s 24 provinces and municipalities are food deficit, with 1/3rd of the population unable to purchase minimum food requirements. This points to a need for increasing efficiency of the food distribution system by:(i) reducing transportation cost by improving road system,(ii) reducing marketing margins by increasing efficiency of rice milling, wholesale and retail outlets, and (iii) increasing imports of  lower grade rice for sale to low-income families.

243.    Boosting Rice Production and Maximizing Farm Incomes.  Rice yields in Cambodia will continue to show significant variations due to high reliance on uncertain rainfall patterns. To develop alternative income sources, the encourages farmers to undertake small farm enterprises such as rearing farm animals and developing small ponds fish rearing, food processing, food sale and provision of farm services i.e. transportation, plowing and machine repair. Rice farmers are also encouraged to plant some productive trees on their idle lands, as additional employment opportunities for increasing their farm income. However, farmers need credit to undertake these enterprises. At the same time, there is a need for a change in farmer’s view of farming from one that is seen as a way of life to one that treats farming as a business.

244.    Community Participation. MAFF programs and policies will, where appropriate, be closely coordinated with other institution involved, with the council for Rural and Agricultural Development (CARD) as the coordinating body supporting agricultural Programs and participation of farmer communities. Two of MAFF’s basic functions involve providing  extension and research services to help farmers to acquire knowledge on techniques and preventive measures in order to increase production

245.    Strengthening Input Distribution. Increased access and better use of quality agricultural inputs is critical to increasing production of rice and other crops. At present, the use of fertilizer by farmers is highly variable because it is often not available and when it is, the price is often prohibitive. This situation reflects lack of market information on the needs of farmers, which impedes efficient distribution of fertilizer and other agricultural inputs. Considerable price differences between regions that cannot be explained by cost of freight reflect collection of illegal taxes and lack of competition among input suppliers. The Government is resolved to promote a competitive environment, the recently completed reform of the state-owned COCMA concerning the agricultural inputs and a stricter enforcement against illegal tax collectors should redress some of these issues. In addition, the Agricultural Materials Law will provide legal standards for inputs including environmental standards and a monitoring and enforcement agency will be established to supervise its effectiveness.

246.    Land Utilization and Management. Currently, cultivated land area has increased at about 30,000 ha. annually . This rate will be doubled over the 2002-2005 with at least2/3rds of new land to be devoted to tree crops such as rubber, cashew nuts, coffee, coconut fruits and palm oil. Gross margins from these crops are about US$2,000 per hectare compared with US$400-900 per hectare for annual crops, except vegetables. Farmers growing two hectares of any of these tree crops will enjoy farm incomes well above the poverty level. A crash program will be implemented to make available supplementary irrigation in rice growing areas, in order to enable farmers to plant a second crop of rice or other annual crops. Growing additional crops provide additional employment opportunities and increase both food supply and farm incomes. The RGC will allocate some state land for agricultural development, with about 50,000 ha. of new land made available each year for development by small farmers, private sector, and public development agencies. This land will be sold at market price for commercial enterprises and at nominal rates to low-income farmers. This is to ensure that small farmers rather than larger private sector enterprises are the main beneficiaries of this new policy. However, given the farmer’s lack of technical skills and capital, such land development may involve partnership agreements with a private company or public development agency. In addition to the rehabilitation of existing irrigation schemes, there is a need to promote the use of shallow tube-well (STW) irrigation, which can be operated either manually or by using small low-lift pumps (LLPS). These low cost pumps involve a low capital cost per hectare in order to ensure financial viability, and will be made available to farmers through a credit scheme. This approach is the quickest and cheapest means  of expanding irrigated areas.

247.    Livestock Improvement: Issues facing this sub-sector are improvement of livestock productivity, strengthening the enforcement of legislation, marketing of livestock and its products, disease control, public health and nutrition/ energy requirements of draft animals and animals for food, feed supply for the additional populations of livestock resulting from anticipated lower mortality, availability of credit for livestock purchases and reform of the marketing system that, at the present, disadvantages the producers. There is a need for better management of additional sustainable feed resource use and credit availability to build stock. The potential to increase livestock production is promising and should attract national and international investment in commercial livestock farms. In addressing the constraints, the RGC has focused on animal health service through disease control, strengthening the cooperation with OIE, WTO, public veterinary service and research.

248.    Fisheries management and Administrative improvement: The MAFF/Department of Fisheries (DoF) is currently reviewing draft fisheries law and legislation to address the most efficient and cost effective strategy for fisheries management, conservation and development. The primary focus of inland fishery management is fishing lot system in which boundaries and the system of bidding. Fishing lot boundaries have been reviewing by releasing 56 percent of total for the local communities in order to establish community-based fisheries management system. On the other hand MAFF/DoF are seeking external technical assistance to improve capacity building of the fisheries inspection programs in terms of monitoring, control and surveillance in both inland and marine fisheries. Marine fisheries also need to improve by preserving habitat and maintaining the adsorptive and regenerative capacities of the marine environment and strengthening the information system for collection, processing, analysis and stock assessment of marine fisheries.

249.    Aquaculture improvement: the traditional aquaculture has been found and need to be improved the capacity of national institutions to promote local aquaculture development by transferring technology through training and extension to the farmer to be able to adopt a new technology to increase aquaculture production. Small-scale aquaculture is recognized and recommended as an important sector to be improved.

250.    Revitalizing Rubber. Rubber has long been a major commercial crop and export earner for Cambodia, and as a labor-intensive crop has the potential to contribute to  poverty alleviation through rural employment creation. At present, total production is still 45,000 Mt., which is 25 percent of the level achieved in the 1960’s. There is scope for increasing the cultivated area from the current 54,000 ha. to about 70,000 hectares, and potential to increase annual production to about 80,000 MT that could provide export earnings of US$54 million annually. The corporatization of the seven existing state-owned plantations should help in transforming these enterprises into efficient productive units.  Along with the planned corporatization, the RGC has assured small farmers that rubber will be treated as any other crop and farmers planting this crop will not lose their land titles. In addition, they will be free to sell their latex in the local free market. With these assurances, the Government expects that more farmers will be planting this crop in the future. Because of low labor cost, Cambodia has a comparative advantage in growing rubber. The new market for rubber wood has made this a dual product crop, which can be grown both for its wood and latex. Expansion of planted crop areas will provide gainful employment to a large number of farmers and raise farm income to levels well above poverty levels.

251.    Forest Concession Management.  The RGC has achieved significant progress since the fifth CG meeting in its efforts to ensure sustainable management of forest resources. In order to improve the performance of forest concessionaires conducting commercial logging activities, the RGC has introduced several rigorous measures, including the suspension of logging activities from January 1, 2002 until such time that a concessionaire would have a new forest management plan approved by DFW/MAFF consistent with international standards and would have renegotiated a model forest management investment agreement with the RGC. Those Companies could not fulfill these requirements will subject to total termination of contracts.  

4.4.2    INDUSTRIAL SECTOR

252.    The RGC’s Industrial Development Action Plan (1998-2003) has two goals: the development of export-oriented industries, and the development of import-substituting production of selected consumer goods. These goals are to be achieved by promoting: (i) labor-intensive industries, (ii) natural resource-based industries, (iii) small and medium enterprises, (iv) agro-industries, (v) technology transfer and upgrading the quality of industrial products, (vi) establishment of industrial zones, and (vii) the development of import-substituting production of selected consumer goods.

253.    The promotion of labor-intensive manufacturing will continue to focus on the textile and garments sub-sector, where the ready supply of mostly female labor underpins cost competitiveness. However, the Government recognizes that retaining and increasing market share in an increasingly competitive international environment requires the upgrading of product quality, as well as greater productivity through improvements in technology and management. The development of better industrial relations within the established legal framework is also needed; and ways of increasing the multiplier effect of garment manufacturing need to be investigated. Currently, most of the garment sector operates on cut, manufacture and tailor basis, with fabric and accessories (zippers, buttons, thread) being imported, and the purchase of local inputs limited to transportation and freight clearing services, utility-type services to run factories, and construction to build factories.

254.    In order to diversify the manufacturing export base, the Government will encourage toy production, whether under license or through foreign direct investment. Such manufacturing is considered to be well suited to the country’s relatively large endowment of low skilled labor. A second area that will be promoted is assembly of electronic products, where all parts and components are initially fully imported.

255.    The promotion of natural resource-based industry will focus on identifying and exploiting opportunities in processing of natural resources, including non-metallic mineral resources, timber, and fisheries. The development of animal and fish breeding may permit their supply as a raw material for reprocessing factories. However, the main prospects in this area are in the use of non-metallic resources for manufacture of construction materials.

256.    In regard to small-scale industry and handicraft production, the Government intends to give priority to the promotion of traditional art and crafts for the tourist market in both rural and urban areas. Another area with potential for expansion is the small-scale tobacco producers who can contribute to increasing the supply of raw materials to the large manufacturers. However, in order to succeed it will be necessary for these enterprises   to ensure sustained product quality. In addition, because they do not have access to credit other than from high-cost moneylenders they will need to be provided micro-finance credit facilities.

257.    The core strategy for agro-industry development is to grant concessional land plots to both domestic and foreign companies on a long-term basis, and to encourage the participation of local small landholders through contract growing for processing factories in the area. The development of agro-industry initiatives will require close co-ordination between the ministries of Industry, Mines and Energy, Agriculture, Fisheries and Forestry, and local authorities, as well as technical assistance in the full assessment of development potential. Strengthening the economic linkage between agriculture and industry within the context of sound environmental management is seen as essential to the creation of incomes and employment.

258.    The promotion of technology transfer and the upgrading of products will require the Ministry of Industry to design and implement a quality control system for export products that sets internationally-accepted standards. In addition, the transfer of technology will require the RGC to develop an appropriate legal and regulatory framework covering copyright, trademarks, and so on.

259.    The creation of industrial zones is aimed at facilitating export development and creating employment by providing high-quality infrastructure and utilities needed to encourage investment. Zones in suburban Phnom Penh and Sihanouk ville would provide transport and communications, power and water, waste management, education and health facilities, and shopping complexes, along with minimal customs formalities and duty-free importation of business inputs. The spatial concentration of export-oriented enterprises would provide a business incubator environment in which ideas and experiences could be exchanged; and would also permit better control of environmental impacts of specific business activities. Other possible regions for industrial/export processing zones include Koh Kong, Battambang (near the Thai border), and Banteay Meanchey (the most populous province). The Government, with external assistance, will conduct feasibility studies during SEDPII and, where feasibility is established, proceed to full project formulation and implementation.

260.    The promotion of import-substitution of selected consumer goods will be undertaken only after a careful analysis of whether or not there is a genuine prospect of a proposed venture becoming internationally competitive.

261.    In general, the Government will support broad-based industrial development by: (i) encouraging expansion of the SME sector, especially through provision of medium and long term finance, (ii) improving the performance of State-Owned Enterprises through corporatization and privatization, (iii) stemming the flow of illegally imported products, (iv) reducing barriers to export such as export taxes and inefficient provision of trade facilitation services (e.g. licensing), (v) reducing barriers to importation of business inputs, (vi) providing infant-industry protection in carefully selected instances, (vii) enhancing the linkage between SMEs and between SMEs and large industries, (viii) promoting a national productivity centre that will assist small and medium size firms to increase productivity and reduce production costs, (ix) establishing a National Institute of Standards that will ensure product quality matches regional and international standards, (x) establishing a National Laboratory with the technical capacity to undertake physical, chemical, microbiological, and mechanical analyses of products that establish the quality and other specifications of these products, (xi) establishing an industrial property rights bureau that would protect new products, designs and technologies from illegal copy, (xii) promoting vocational training domestically and overseas, and (xiii) upgrading the legal framework in the areas of factory law, industrial zone law, patent and industrial design law, weights and measures, industrial safety.

262.    Private sector organizations will play a key role in identifying industrial development opportunities and constraints, participating in the policy formulation and monitoring processes, and promoting domestic and foreign private investment.

263.    Mineral Sector: So far the result of geological studies and mineral investigations have indicated that there are about 133 mineral deposits, including 26 deposits of iron and ferro-alloy metals (iron, manganese), 15 deposits of base metals (bauxite and cooper), 21 deposits of precious metals (gold), 51 deposits of industrial minerals (limestone, phosphate and silicasand), 14 deposit of gemstones and ornamental tones (ruby, sapphire, marble, pagodite), 6 deposits of coal, and other deposits of construction materials. Industrial minerals are important inputs as raw materials for mineral-based industries, including cement and phosphate fertilizer factories. Construction materials, such as sand, clay gravel and crushed rocks from granite and other rock resources, are the raw materials utilized by the building and construction industry as well as in the road and bridges constructions. The development of the mineral sector is an important element for achieving socio-economic development, particularly as a source of raw materials for mineral-based industries. The development of this sector, however, will require the participation of both local and foreign investors. The Law on mineral Management and Exploration was promulgated in July 2001, and it is hoped that with the Law in place both domestic and foreign mining companies will invest in the mineral sector in Cambodia.

4.4.3    TOURISM

264.    With Cambodia’s enormous cultural and natural heritage, tourism policy will be geared towards cultural and eco-tourism. It will ensure the sustainable development of cultural and natural environment as well as the protection of the environmental without becoming an impediment to development. The important issue is how to effectively and efficiently manage and/or balance between protection and development and establish a zoning plan for tourism development to ensure sound management of the sector.

265.    There are many historical sites in Cambodia. The Angkor temple is the world's priceless heritage and belongs to all mankind. There is a need to develop a proper master plan for its restoration, development and protection. The development of this area is considerably slow. At present, there are only some road signs for direction, some rest rooms and other facilities to serve visitors. The work on the master plan has to be done as soon as possible by preparing a plan for its development and making the plan available to private investors for their participation                  

266.    Besides the Angkor area, we have other cultural and eco-tourism destinations such as the Kulen Mountain, Kos Ker temple, Preas Vihea temple, and Ta Mok house in Anlong Veng, which can be used as a historical tourist destination.  These areas can be developed as a big cultural, historical, and ecological recreation zone, which should not be limited to Angkor.  In addition, Tonle Sap Lake has a great potential for developing eco-tourism, such as the water bird area and the fishing villages. In the central zone, there is the Sambo Prey Kuk temples to which a road has been built

267.    The Siemreap Airport terminal needs expansion as soon as possible to meet the technical standards, including the landing area and passenger terminal, which need to be enlarged quickly.  Many airlines have expressed their interests to fly directly to Siemreap, but are unable to do so because the Siem Riep airport does not fully meet internationally recognized technical requirements. There is a need to develop other infrastructure in this area such as water and electricity supply, with some priority for developing the power sector.

268.    The work on road from Siemreap to Kampong Thom and from Poipet to Siemreap needs to be completed as soon as possible.   Construction of a 17-km stretch from Rolous to the Siemreap provincial town, with funding from Japan, has been recently completed.  However, the road from Kompong Tom to Siemreap border has been delayed.

269.    The second area of interest to tourists is Phnom Penh, which is not only the capital of Cambodia, but also its commercial and industrial center. Phnom Penh and the surrounding areas also have potential tourist destinations such as the Mekong river landscape/view, the Preah Raja Trop Mountain, the Chiso Mountain, handicraft production areas, silversmith, silk and mat weaving, and as well as the important historical holocaust center.  At present, work on the expansion of the Pochentong airport in Phnom Penh is underway. The expansion will enable Boeing 747 or Airbus 340 flying from big cities in Asia pacific, America, and Europe to land.  When National Road number 1, from Vietnam to Phnom Penh, is completed and fully operational plus the opening of boat tours from Vietnam-Phnom Penh-Siemreap; Phnom Penh will become the country's commercial and tourism center on par with the Siemreap Angkor zone.

270.    The third zone is the Coastal zone, which received a cruise ship to test the water to develop this kind of tourism. A port development project, financed by a loan of US$40 million from the Government of Japan is currently underway. However, in addition to rehabilitating and developing the port, the Government would like to develop a tourism port where big cruise ships can land including a passenger terminal for passengers and a border checkpoint. 

271.    The Government’s policy thrust on Culture and Fine Arts is to enrich the national culture in a way that supports the expansion of services and the creation of employment opportunities for the people and thus contributing to the national goal of poverty alleviation.  Developing the cultural resources of Cambodia, especially the Angkor temples sites that have been attracting increasing number of tourists, is a priority of the RGC not only as a socio-cultural development goal but also because of the economic/revenue generating potential of these historical sites.  The conservation and development of the national cultural resources will require that other areas where ancient temples are located should also be repaired in order to transform them into cultural tourist zones. The Ministry of Culture and Fine Arts is focusing on the rehabilitation of cultural infrastructure such as:  the renovation of the Royal University of Fine Arts to develop the needed human resources; repair and conservation of various ancient temples; and, repair, renovation and modernization of the National Museum and of the National Library.

4.4.4    TRADE

272.    Work on Cambodia’s accession to the WTO is well advanced. However, complying with WTO requirements is very demanding for a small developing country like Cambodia and we could benefit from badly needed technical assistance in several areas: legislative framework, valuation procedures, trade policy evaluation and reporting, assessing the impact of trade protection.

273.    Notwithstanding the opening of trade many significant tariff and non-tariff barriers remain. The non tariff barriers to trade involve various bureaucratic costs (often unofficial) and the need to comply with international labor standards as a condition of international market access.  Although, customs administration has significantly improved in recent years establishing a low cost formal trade facilitation system faces many difficulties. To begin with, the administrative task is daunting given the porous borders with three neighbors and a long coastline with many rivers and bays. Second, various trade arrangements (rules of origin requirements, preferential trading arrangements in ASEAN) complicate this task. Third, the institutional framework for border control is opaque, with unclear mandates among different agencies. Fourth, limited resources constrain the capacity of the customs department to carry out its functions. Civil service salaries are low, physical support facilities are inadequate, and management information systems are poor. These difficulties are reflected in high unofficial payments, widespread smuggling, unreliable clearance and processing times, and tariff collection that is significantly lower than is implied by the official tariff.

274.    Apart from the difficulties associated with ‘external’ trade facilitation, ‘behind the border’ constraints (for example, transport, market intelligence) are also significant deterrents to exporting. Shipping charges in Cambodia are the highest in the region and four times the cost for shipments of comparable size in Thailand. Carefully monitored user charges or toll operations to fund road maintenance and construction would be the way to address this problem. So would fuel taxes. TA is needed to examine the implications of such options for fund raising and road fund sharing at local levels.

275.    Rice is an important source of food for most rural households. An evolution is occurring from rice as a source of food security to rice as a source of trade and income. Rice trade both within the country and across the border is currently constrained by poor transport infrastructure. In addition, export procedures and ‘Facilitation fees’ pose a significant tax on rice exports. Simulation of impacts on poverty indicate that improving two major elements in rice production technology (paddy to rice yield and post harvest losses) would reduce transaction costs and improve the livelihood of poor Cambodians. A detailed exposure of these unofficial charges is needed to reduce constraints on current and potential exporters of rice.

276.    Diversification of agriculture away from rice is increasingly common. The key obstacles to developing non-rice agriculture are similar to those for rice. They include poor transport infrastructure, high energy costs, weak information systems, inherited distrust among buyers and sellers, inadequate access to credit and limited business development skills. Cambodia could potentially benefit from the increasing demand for niche agricultural products, such as spices, herbs, specialty tropical fruits, sesame seeds and essential oils. To do so, action is needed on several fronts. First, the institutional capacity of the Ministry of Commerce needs to be strengthened. Second, technical assistance is needed to help small farmers and processors with their informational needs. This could include the facilitation of establishing associations interested in marketing, technology and purchasing inputs.

277.    Handicraft production has been hampered by years of civil strife and war that broke the chain of traditional transfer of skill and design. Craftspeople lack critical information on market demand, quality standards and trends. As with diversified agriculture, technical assistance is needed to identify barriers to and sources of market information and to support building associations of people with similar interests in marketing, technology and the sourcing of inputs.

278.    Fisheries sector development is hindered by intervention of government agencies in almost every aspect of market transactions. Building a competitive and market responsive fisheries sector will require a change in the corporate culture in the sector to nurture market-based transactions. Regulation of management regimes to control over fishing is required. Technical assistance is needed in two main areas: fisheries marketing and distribution and fisheries management. In management, TA is needed to examine the incentives for short-term exploitation, unregulated common property fisheries and establishing transparency in the allocation of fisheries access. In addition, TA can help with developing a regulatory system for exports to the US and the EU and enabling the private and public sectors to collectively develop a long-term strategic vision for the fisheries sector.

279.    Garment sector export growth has been spectacular over the past several years. Some 160 000 people are reported to work in the sector. This growth reflects a combination of limited access to the currently highly restricted US and EU markets (set to expire in 2005), a hospitable policy environment and competitive production costs. In the case of the US, preferential access means that Cambodia has some access to a tightly restricted market. While Cambodia has US market access for a large number of duty items and quota under GSP, for the items it does export - garments, MFN rates apply and for those garments where Cambodia has shown itself to be especially competitive quotas now apply. For the EU, preferential arrangements are such that Cambodia can export without duty and quantitative limits so long as rules of origin requirements are met. These requirements are in most cases not met given the limited development of Cambodia’s textile sector. However substantial production from Cambodia is sufficiently competitive to be able to sell on the UK market without the concession.

280.    Tourism is growing at over 30 per cent annually. The challenge for this industry is to find the appropriate roles and tasks for government industry, private operators with respect to such things as industry statistics, promotion, training, certification and charging for ‘unique’ attractions such as the temples of Angkor Wat. Core technical assistance needs are: TA to collect tourism related data and to analyze it; a careful evaluation of the net benefits of tourism to Cambodia and its long-term potential; developing a tourism development strategy, involving all major stakeholders, building on successful private-public partnerships such as the Tourism Working Group; in conjunction with the tourism development strategy, identifying those investments necessary to encourage greater regional and domestic tourism as well as eco-tourism – all of which would help the poor; and establishing the appropriate role of the government in regulating, ‘charge’-setting, setting standards and collecting industry statistics.

281.    Labor export has been an important option for reducing poverty in several of Cambodia’s Asian neighbors, such as the Philippines, Sri Lanka, Thailand and Vietnam. The Royal Government policy is to encourage official labor exports to increase welfare, enhance skills, reduce unemployment and increase state revenues. Constraints to increased exports of workers include, low education and limited foreign language skills, an increasingly competitive market for export labor, and complex regulatory and administrative requirements. Developing appropriate government policies and regulations and bilateral arrangements, which do not prohibitively raise costs yet adequately protects the interests of export workers poses a challenge. Technical assistance is needed in these areas and should draw on the considerable regional experience in developing labor markets and regulations.

282.    Information Technology has much to offer in enabling all these sectors to move to more productive systems. Already some of Cambodia’s many young people are embracing IT based activities. In some cases IT systems are being used to convey market information and expedite transactions of handicrafts produced in villages far from urban centres. In other cases Cambodians are processing data from other countries and thereby effectively exporting data processing services.

283.    To draw maximum benefits from the ever changing global market, Cambodia needs to tackle inter-related actions at three levels: significant improvements in market access, linked to a coherent program of technical assistance and capacity building, and based on continuing domestic policy reforms and adjustments.

| Content | Back | Top | Next |


Home | 6th CG Meeting| Agenda | Contents| List of Participants | Position Paper | DCR | Partnership | Government | Donors | Download | Map | Photo