Essay: Cambodia economy

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  • Cambodia economy
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In Southeast Asia, Cambodia is one of the poorest developing countries. The environmental problems in Cambodia lower the value of and access to productive resources as well as create health issues, especially for the poor, which increases vulnerability and complicates economic development and the fight against poverty.
 
In the year of 2015, according to Asian Development Bank:

• 14% of the population lives below the national poverty line in Cambodia.

• The proportion of employed population below $1.90 Purchasing Power Parity a day is 33.6% in Cambodia.

• For every 1,000 babies born in Cambodia, 25 die before their first birthday.

Poverty Data (Year 2015)

Source: https://www.adb.org/countries/cambodia/poverty

Poverty is one of the factor that causes environmental problem in Cambodia. Poverty refers to the condition of not having the means to afford basic human needs such as clean water, health care, nutrition, clothing, shelter and education.

Poverty and environmental issues are interrelated. Poverty among people puts stress on the environment whereas environmental problems cause severe suffering to the poor. Poor people does not give any thought to the preservation and conservation of natural resources due to their extreme poverty and lack of knowledge on environmental handling as they cannot afford to get education. Besides, they tend to over-utilize the natural resources since they do not have any other alternate means of livelihood except the use of natural resources.

Many poor women lack the resources needed to engage in birth control as extreme poverty doesn’t always have access to birth education. Therefore, it is common for poor women to continue having children well after they would have liked because of little or no access to resources and education. The more the global population grows, the more weight is placed on the environment. Every human being consumes their share of resources from the environment, and with so many births originating from poor communities, the burdens placed on the environment become heavier and heavier each day.

Poverty often causes people to put relatively more pressure on the environment which results in larger families (due to high death rates and insecurity), improper human waste disposal leading to unhealthy living conditions, more pressure on fragile land to meet their needs, overexploitation of natural resources and more deforestation. Insufficient knowledge about agricultural practices can also lead to decline in crop yield and productivity etc. In addition, poor people harvest natural resources for their survival or in order to meet their basic needs such as firewood, agricultural productions (such as maize), and water and wild plants for their medicine. All in all, poverty has directly or indirectly, gives an impact on the environment in Cambodia.

Agriculture, fisheries and forest resources play an important role in supporting livelihoods,

especially in providing diversifying subsistence and income-generating activities. They provide a safety net to families during difficult times (Bradley, 2009). According to Poverty Environment Partnership (2005), between 20% and 58% of household income derive from common access resources including fuel wood, fishery, and resources provided by the mangroves (with heavier reliance among poorer households). Amongst the poor, a quarter depended solely on fishery and forestry products for over half of their income in 2004 (WB, 2006). World Bank President Paul Wolfowitz said, “Improving the management of forests, land, and other natural resources is essential for the well-being of the Cambodian people and its economy, and the Bank should try to stay engaged to promote further dialogue and information disclosure to help build consensus for the future.”

The country’s economy is strongly dependent on natural resources, and agriculture is one of the resources for generating employment, income and potential foreign trades. Improving infrastructure is a way to boost agricultural productivity. Farms with access to markets in their villages have 26% higher crop yields than those without. Farms closer to roads also have higher yields; reducing the distance from a village to an all-weather-road by one km raises productivity by about 30,000 Riel/ha (WB, 2006). Furthermore, lack of irrigation

systems is a commonly cited constraint to improved agricultural productivity. With

improved integrated land and water resource management, taking land-use change,

deforestation and climate change into account, there are opportunities to improve

agricultural productivity, employment rates, and livelihood opportunities.

Inserey (2013) stated that, agriculture, led by rice farming, contributes to roughly one-third of the country’s GDP and has immense potential for strengthening Cambodia’s economic growth, accelerating poverty reduction, and improving the living standard of its citizens. As part of this agenda, in 2010, the Royal Government of Cambodia (RGC) adopted a new Policy Paper on Paddy Production and Rice Export, better known as the Rice Policy, to promote diversification of Cambodia’s economic sectors by catalyzing growth in paddy rice production and milled rice export to match the growth seen in the garment and service sectors. In his keynote address at the policy’s launch, Prime Minister Samdech Hun Sen said: “The policy aims to ensure that we grab the rare opportunity to develop Cambodia in the post global financial and economic cataclysm.”

If Cambodia’s rice export sector were to reach its full potential, it could produce 3 million tons of milled rice, with the total export value amounting to $2.1 billion (approximately 20% of the GDP) and an estimated additional $600 million (approximately 5% of the GDP) to the national economy. It would also raise employment and income for agricultural farmers who make up larger than 70 percent of the population living in rural areas (Inserey, 2013).

Given the priority to poverty alleviation, food security, environmentally friendly sustainable

growth, and integration in global competitiveness, the principle of equitable agricultural

development would focus on the following components:

• Maintenance of an appropriate macro-economic and policy framework, and a favorable legal, and institutional arrangement,

• Accelerated and sustainable irrigation development,

• Accelerated program for titling and distribution of unused agricultural land which is under Ministry of agriculture, Forestry and Fisheries (MAFF),

• Development of an export market for rice and other agricultural products, and processing and product quality control facilities,

• Strengthening essential agricultural support services and functions including extension, research and development, marketing, credit and input distribution, and

• Expansion of livestock production with emphasis on animal health services, nutrition and range management and establishment of meat processing plants.

Fisheries play a critical role in rural livelihood, providing food security, income and

employment for a huge proportion of the rural population. There are opportunities to

improve rural livelihoods and public revenue through improved resource management,

expansion of processing, and a more equitable distribution of fishery benefits, for example

by improving and pursuing the governance reforms and decentralization process.

The following specific suggestions are made from the viewpoint of management of Cambodia’s

inland fisheries, but they also need to be considered in the context of overall development of the resources of the Mekong.

• All sectors should cooperate in integrated water resources management.

• Development planning should recognize the value of fisheries and their importance in the livelihoods of Cambodians.

• Environmental Impact Assessments should consider all options for development, as well as the costs and benefits of competing uses of water.

• Plans for water management projects should include consideration of sustaining, and where possible, increasing fish production.

• The main elements of the flooding cycle and important fish habitats should be maintained where possible; if water management projects are designed to reduce flood levels, then the consequences for fisheries production should be appraised and appropriate substitutes for livelihoods and income for those affected should be available.

• Any evaluation of dams proposed for the Mekong mainstream and major tributaries should consider the consequences for fish migrations and floodplain production downstream, and should recognize that impacts could not be fully mitigated.

• Mitigation measures should be incorporated in the design and operation of dams, including low-level weirs; these could include fish passes, maintenance of riparian flows, re-regulation of discharges and measures to improve water quality.

• Communities should be empowered to manage and conserve fish at a local level and deal with illegal fishing practices and habitat destruction.

• Fish habitats on floodplains should be enhanced; for example by maintaining or creating dry-season refuges and channels for migrating fish.

• Dialogue should be maintained between the Lower Mekong Basin (LMB) countries on mitigating trans boundary impacts from water management projects, fishing activities and exotic species, both up-and downstream of Cambodia. The Lower Mekong Basin (LMB) covers an area of approximately 606,000 km2 within the countries of Cambodia, Lao PDR, Thailand, and Viet Nam (Mekong River Commission, 2009).

The forests constitute a great resource; the challenge is to utilize these resources for the

benefits of people and countries without destroying them. Progress can be made by

recognizing that forestlands are part of the rural economy and people’s livelihoods.

Policies could better address the linkages among community livelihoods, investments,

markets and infrastructure, rather than viewing forests as raw material for export-oriented

processing. More specifically, Reduced Emissions from Deforestation and Land

Degradation (REDD) could provide an opportunity to preserve the forests and reduce

emissions of greenhouse gasses while benefitting economically, and the possibilities of

REDD having pro-poor benefits could be investigated. Trade in certified timber products,

from planned, sustainably managed forests, is another opportunity. There is a huge market

for non-timber forest products (e.g. bio-trade and biotechnology) that could be explored.

Forests are the main sources of income and can reduce poverty rate and even improve rural livelihoods if proper management is achieved. Thinking of renewable resources, forests are essential in rural development and local economic improvement. From sustainable forest management and non-timber forest products (NTFPs) such as resin, rattan, and bamboo collection, local people can continue to benefit from their nearby natural forests. Demands for NTFPs like rattan, bamboo, and other lianas for furniture in cities and hotels provide more income generation opportunities for local people who collect these raw products.

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