AN OVERVIEW OF THE I-PRSP[1] The Interim Poverty Reduction Strategy Paper (IPRSP) is a document outlining the governments intended strategy for reducing poverty. It is required by the World Bank (WB) and International Monetary Fund (IMF) before they grant more external assistance to Cambodia. The IPRSP will be considered by the WB and IMF Boards in December 2000. The preparation of the full PRSP, which will be finalized by October 2001, will allow active participation of the local communities and authorities. The essential features of a full PRSP are: (i) country ownership; (ii) poverty focus; (iii) consultative process; and (iv) systematic monitoring of outcomes. Drafting processThe preparation of the I-PRSP
was commissioned by the Prime Minister Samdech HUN SEN and overseen by the
Committee on Economic and Financial Policies which is headed by the
Minister of Economy and Finance, with broad inter-ministerial
representation. Six drafts of
the IPRSP have been prepared for comments by stakeholders, including key
government officials, chairpersons of the National Assembly and the Senate
commissions, umbrella NGO groups, the private sector and various donors.
A Khmer translation is already being prepared. The
RGC has piloted the partnership approach in the PRSP process, which will
be closely linked to the formulation of the Second Five-Year
Socio-Economic Development Plan (SEDPII). The
preparation of SEDPII was launched at a National Workshop held in May
2000; the SEDPII will be
finalized in March 2001. These
two important government documents will be implemented in a single
strategic framework in conjunction with other poverty-related activities. Contents of the IPRSP The I-PRSP
contains the following sections:
Nature of Poverty Different measures are used to measure poverty, sometimes defined as a lack of income or consumption and lack of opportunities. Broader dimensions of poverty include poor education and health; the major surveys in recent years are the 1997 Socio-Economic Survey and the Health Survey. In Cambodia, the measurement of poverty is based on a poverty line that accounts for food consumption (that provides at least 2,100 calories of energy per person per day) and non-food consumption (e.g. clothing, basic shelter). The 1999 Poverty Profile in Cambodia shows that 36% of Cambodians live below the poverty line; in 1993-94, the poverty rate was 39%. Of the 36% poor population, 90.5% live in the rural areas, 2.3% in Phnom Penh and 7.2% in other urban areas. Moreover, the percentage of Cambodians living in poverty fell slightly from 39 percent in 1993-94 to 36 percent in 1997. Poverty in Cambodia is set against a background of 30 years of conflict and internal displacement. The most disadvantaged groups in Cambodia are internally-displaced people and returned refugees, war widows, orphans, street children, squatters, people with disabilities and isolated ethnic communities. The different dimensions of poverty are: 1. Lack of opportunities: Þ The poor lack access to education, health care and safe water. Þ The poor lack markets, communications, infrastructure, security. Þ The poor lack knowledge of their rights. 2. Vulnerability: Þ The poor face food insecurity and malnutrition. Þ The poor lack modern technology, and access to quality grains, fertilisers, irrigation and credit. Þ The poor have declining access to common resources such as forests and fisheries. Þ The poor sometimes are forced to sell their land to pay for medical treatment. 3. Low Capabilities: Þ Low school enrolment rates. Þ Low life expectancy. Þ High infant mortality rates. Þ The poor lack access to public services. Þ High costs of education and health. 4. Social Exclusion (barriers which prevent the participation of the poor in society), is due to: Þ Illiteracy. Þ Lack of access to decision making. Þ Official Corruption. Review of Existing Strategies & Performance The I-PRSP will build upon existing poverty reduction strategies and social and economic policies. These include the First Socio-Economic Development Plan 1996-2000 (SEDPI) and other key government documents that aim to: restore peace and stability; integrate Cambodia into the regional and global economy; undertake broad macro-economic and public sector reforms. A Governance Action Plan (GAP) will also be incorporated into the final version of the PRSP. The SEDPI emphasized rural development and stressed the need to balance this goal with the development of major urban growth poles. The SEDPI target allocation for pubic investment expenditures was 65% to go to projects in rural areas and 35% to urban areas. The implementation, however, turned out to be the opposite -- 65% of investments went to urban areas, while only 35% went to rural areas. Moreover, past efforts to reduce poverty have focused mainly on stand-alone projects that neglect the broader and policy and institutional environment of poverty reduction. Cambodian rural development programs focused on primary health care, sanitation and rural water supply, among others. Statement of Poverty Reduction Strategies & Objectives The government's pro-poor policy should be geared
toward establishing a favorable environment to promote and generate
economic growth without environmental degradation and equitable
distribution of income. On the basis of this broad strategy, the RGC has
formulated the following policy response to poverty: promoting
opportunities, creating security, strengthening capabilities and
generating empowerment. Growth is the most powerful weapon in the fight for
higher living standards. Faster growth will require policies that
encourage macroeconomic stability, shift resources to more efficient
sectors, and integrate with the global economy.
However, the benefits of growth for the poor may be eroded if the
distribution of income worsens. Even
with economic growth there is still room for policies that target
interventions to improve health and education outcomes.
At the top of the list are female education to ensure gender
equality, safe water and sanitation, child immunization, as well as social
safety nets to protect the most vulnerable.
Attention is also needed to the social structures and institutions
(or ‘social capital’) which affect development. 1- Promoting
opportunities The RGC’s approach to promoting opportunities is via strengthening
macroeconomic performance, accelerating economic growth, promoting private
sector development, developing the physical infrastructure, strengthening
the energy sector, ensuring sustainable development of the agricultural
sector, improving water resource management, advancing rural development
and decentralization, ensuring a sound natural resource management,
encouraging income generation activities, embarking on land reform and
increasing access to microfinance for the poor. Though well-targeted
programs for rural areas could have quick impact on the rural population,
poverty reduction strategy should not be overtly reliant on the
development of agricultural sector, given poor performance of the sector
in the past. Industrial and
service sector development could become a powerful locomotive to pull
Cambodia out of the shackles of poverty. Table 1. Linking Poverty Diagnostics to Government Policies
2- Creating security Reducing the vulnerability of the poor by developing resistance to external shocks and increasing the overall sustainability of their livelihoods is a priority as is assisting those poor who want to diversify out of agriculture, and these concerns have not received sufficient attention. The current emphasis is on credit for income generating activities, but there is a need to also address vulnerability to fluctuations in income, as this results in cash flow constraints that may lead to deferment of investment and/or distressed land sales, so as to smooth consumption expenditure. This could be tackled by providing insurance, savings and loans for consumption purposes. Moreover, security can be ensured by expanding safety net programs, promoting environmental protection and clearing landmines. 3- Strengthening
capabilities The government plays a crucial role in the service delivery and the improvement in capabilities. This requires a focus on the quality and availability of services for the poor and the comparative advantage of the government, non-governmental organizations and private sector agencies as the supplier of these services. Essentially this focus is on the role of government and issues of effectiveness and efficiency and involves questions about the degree of government decentralization and civil service reform. 4- Generating empowerment
Priority actions that needs to be taken by taken by
the RGC over the short to medium term are: Establish priority groups of
government officials to improve service delivery and increase
productivity; expand decentralization and continue deconcentration of the
system of administration to increase accessibility of essential services
to the people; accelerate the reform of the state by implementing action
plans in demobilization, administrative and fiscal reforms with a view to
strengthening the rule of law and consolidating the foundation of the
market economy; deepening the judicial reform and establishing a national
program for judicial reform; and implement the measures outlined in the
Governance Action Plan (GAP). Capacity-Building & Monitoring The emphasis of the PRSP must be on the implementation of poverty reduction policies and the monitoring and evaluation of their targets. Poverty reduction targets to be set and monitored should be relevant, simple and easily updated when required. A sound institutional capacity for the implementation of poverty reduction strategies should be ensured. More attention should be paid to inter-ministerial coordination in carrying out poverty reduction strategies. A poverty monitoring mechanism needs to be set up and systematized. PRSP Workplan Overall responsibility for the full PRSP will pass from the Ministry of Economy and Finance (MEF) to the Ministry of Planning (MOP), which is also responsible for the ongoing preparation of the SEDPII. Participatory processes include the following:
Policy Matrix ANNEX 1: POLICY MATRIX (2000-2002) [1]
Seventh draft for submission to the Cabinet (as of 2 September 2000).
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