The Center for Social Development

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1 The Center for Social Development Second Regional Conference on Poverty Reduction Strategies October 16-18, 2003 Phnom Penh, Kingdom of Cambodia by Chea Vannath, President Center for Social Development The way I look at the current socio-political economic development is that Cambodia is in a transitional period from an emergency stage to a developing and nation building stage. The opening of the country in early 1990s brought every thing to the country: the good, the bad, and the ugly. Therefore, my view on the efforts and constraints of the National Poverty Reduction Strategies (NPRS) in Cambodia is as a half full and half empty glass of water. For the purpose of this conference, I ll focus on how to fill the half empty glass, which must be based on trust between and among the civil society, the government and donors. This needs to be a real trust based on the good governance, with accountability and transparency.

2 I. HOW DOES WEAK GOVERNANCE AFFECT ECONOMIC GROWTH AND DELIVERY OF BASIC SERVICES? The followings are some illustrations of the economic situations, extracted from the newspapers and surveys: Macroeconomic stability has largely been achieved, with inflation below 5 percent and the ensuing exchange rate stability conducive to growth. Real Gross Domestic Product (GDP) growth averaged 7 percent from 1999 to (The Cambodia Daily, on April 23, 2003) Military and defense spending declined from 4 percent to 2.7 percent of GDP during 1998 to 2002, while health, education, rural development and agriculture spending rose from 1.3 to 3.6 percent of GDP. But despite these positive results, poverty remains disturbingly high. Indicators show that: At least, 36 percent of the Cambodian population lives below the poverty line of, approximately, US$0.50 per day at the current October 2003 exchange rate. The cycle of poverty, ill health, and high health care costs by households economically cripples poor Cambodian families. An OXFAM study of landlessness found that 40% of newly landless people lost their land because of ill health. Every eight child dies before the age of five. In most cases malnutrition, lack of health facilities is cause of death. 60 percent of children are suffering from anemia. WHO: Child Mortality Campaign Lagging, The Cambodia Daily, September 22, 2003 What is wrong? An article in the Phnom Penh Post, August 1-14, 2003, reported a dengue outbreak far worse than last year (number of new cases jumped 56 percent). The stated reasons for the increase were the delay in disbursements, and the misallocation of health budget around the time of election. Another article in the Phnom Penh Post, August 15-28, 2003, reported a World Bank survey finding that of just six sectors of the Cambodian economy found potential losses of almost a quarter of a billion dollars to GDP every year were due to market and administrative distortion. Given that GDP is only $3.5 billion, that $226 million represents a huge lost opportunity and also represents forgone activity that would generate around $28 million annually in government revenue. by Chea Vannath, CSD President, at the 2 nd Regional Conference on Poverty Strategies, 10/16-18/2003, Phnom Penh, Cambodia 2

3 Within the last ten years, there has been a radical transformation from a communist and control market economy to an open, free for all, market economy. Foreign aid started pouring into Cambodia in the amount of approximately US$500 millions annually, representing half of the Cambodian National Budget. The value of money and material wealth is replacing what is left of traditional Buddhist morals. The illegal logging and the man-made depletion of the natural resources currently taking place is an example of how greed has replaced our traditional respect for our living world. The aid comes from a spectrum of foreign countries with different and competitive agendas, different and competitive requirements, and different and competitive expectations. Including the IMF, World Bank, and ADB, they provide technical assistance to promote democracy, good governance, transparency, accountability, and the rule of law. They focus on economic growth, but are the economic benchmarks of GDP and GNP enough? I feel that careful planning, coordination, and on-going monitoring are needed to improve the quality of life, the well-being and dignity of the people? II. HOW HAS IT BEEN ADDRESSED BY PRSs IN CAMBODIA? Why do we need to improve governance? The concept of good governance is broadly characterized by transparency, accountability, public participation, predictability, adherence to the rule of law, and cooperation between government and civil society. On the other hand, corruption is a key symptom of weak governance. Studies show that corruption is widespread in Cambodian society with the judiciary, customs, tax authorities, health sector, education, road services and police the worst affected areas. (Source: CSD s report, National Survey on Public Attitudes towards Corruption, Center for Social Development, August 1998.) The Royal Government of Cambodia (RGC) views good governance as an essential pre-requisite, and corruption as a major constraint to sustainable government. Although efforts have been taken by the RGC, the key elements of good governance are still lacking. In the National Poverty Reduction Strategy (NPRS) has stated eight important actions to reduce poverty in Cambodia, strengthening institutions and improving governance is one. The others are: - Maintaining Macroeconomic Stability, - Improving Rural Livelihoods, - Expanding Job Opportunities, - Improving Capabilities, - Reducing Vulnerability and Strengthening Social Inclusions by Chea Vannath, CSD President, at the 2 nd Regional Conference on Poverty Strategies, 10/16-18/2003, Phnom Penh, Cambodia 3

4 - Promoting Gender Equity, and - Priority Focus on Population. All actions related to good governance. According to the NPRS, the RGC is committed to implement the Governance Action Plan (GAP), a rolling strategic framework that provides a consistent and transparent approach to coordinate efforts in eight priority areas: - Legal and Judicial Reform, - Administrative Reform and Decentralization, - Decentralization and Local Governance - Public Finance Reform - Anti-corruption, - Gender Equity - Demobilization and Reform of the Armed Forces, and - Reform of Natural Resources Management (land, forestry and fisheries) What are the obstacles to good governance? The NPRS also underlines the lack of access to law and rights as a serious issue for the poor. But, does not offer solutions and measures to improve the situations. Therefore, many existing laws and regulations have been adopted without consultations with the local communities. People are excluded because of the fragmented lines of communications gap between the government and the people. Furthermore, the good intentions of the NPRS are important, but it is insufficient. There is a disconnection between technical assistance and the Cambodian realities. The reality is that the patronage system is strongly rooted in society. Administration system in pre -colonial Cambodia was based on a patronage system whereby villagers or the people of a particular region gravitated around powerful warlord-like patrons who dispensed all kinds of favors to their clients in return for tributes and loyalty. Patrons protected their clients because they needed bases of support to build their strength and expand their spheres of influence. The current patronage system is fuel by the lack of trust among, and between, the civil society, the donor communities, and the government. III. WHAT INDICATORS AND MONITORING TOOLS CAN BE USED TO TRACK GOVERNANCE IMPROVMENTS? by Chea Vannath, CSD President, at the 2 nd Regional Conference on Poverty Strategies, 10/16-18/2003, Phnom Penh, Cambodia 4

5 Just to name a few, indicators and monitoring tools to track Governance improvements are: (1) Independent National Audit Authority The Government s promulgation of the Audit Law and establishment of the National Audit Authority is a positive step in building accountability and transparency. But, for that institution to become effective, it needs to be independent from political influences in which is not the case at the moment. (2) Decentralization Another step taken by the Government is increased decentralization and deconcentration. The newly elected (2002) commune councils are taking over crucial decision-making powers from the Central government. This is thought as a way to hinder corruption and gain transparency. The wish is that the dilution of power will contribute to diminish corruption at the central level. The problem is, the bureaucratic system is relies on corruption in order for civil servants to survive. Therefore we might not see less corruption through decentralization, but just a relocation of corruption. It is not possible to diminish corruption as long as police staff, administrative workers, school teachers and other public servants only get around US$20 a month while the cost of living is five to ten times higher. How do we expect a hungry person to be ethical? (3) Implementing Governance Action Plan (GAP) A third governmental tool used to fight corruption and work for transparency is the establishment of the Governance Action Plan (GAP) which brings governance-related initiatives under a common framework to ensure smooth and coherent implementation. This calls for a predictable and enforced legal system conducive to protecting individual rights and freedoms and promoting domestic and foreign investment. It also implies improving the quality of public services, a mechanism for greater accountability and transparency in society and in the everlasting fight against corruption. (4) Anti-Corruption Legislation At last, after 10 years of efforts, the government just finalized its draft of the anti-corruption legislation that still needs to be reviewed and debated at the National Assembly. But the current draft law does not have quality to alleviate poverty; it rather allows the corruption to go around the system. Furthermore, to fight such a wide spread corruption, the country needs a strong political will, by Chea Vannath, CSD President, at the 2 nd Regional Conference on Poverty Strategies, 10/16-18/2003, Phnom Penh, Cambodia 5

6 courage and determination from its leaders, and cooperation and support by all political parties and the public to carry out the reform. (5) Recent Drug Seizures The recent seizure of more than thirty kilograms of heroine and the continued crack down of drug trafficking in the city of Phnom Penh is a new positive phenomenon in the Cambodian history. But, this effort needs to come from the heart of the Cambodians themselves for the sake of their nation, rather than from the international community pressures. (6) Non-Violent Atmosphere After the 2003 General Election Last, but not least, although Parliament had not resumed as of the September 28, 2003 dead-line, the non-violent atmosphere after the 2003 General Election result is worth mentioning, because this is the first time, since 1993, that the three major political parties have tried to have a fair share of powers among them democratically. But, the purpose of having every five years election is to democratically elect the representatives of the people who have a clear vision about how to build a nation and providing the well being and dignity to their people, and not to complaisantly allow the leaders to be in power for their own individuals or party interests. IV. HOW CAN IMPROVED PARTICIPATION OF THE POOR, WOMEN AND OTHER VULNAREBLE GROUPS ENHANCE ACCOUNTABILITY AND SERVICE DELIVERY? The Situation of Women From 1975 to 1979, the Khmer Rouge decimated two third (2/3) of the adult males in the 20 to 50s age group. Cambodian women kept the country and families running strongly during the twenty (20) years of civil war and destruction. The wide spread corruption, which leads to impunity, negatively affects the socio-economic of women, poor, and vulnerable group, such as low status, high rate of child prostitutes, family violence, rape, illiteracy and poverty among other conditions, and extremely low levels of access to education, health care, information, technologies and services. For the NPRS to be successful, we need to improve women participation. We need to break the glass ceiling between the Government policies and the recipients. We need to promote on-going dialogues with the poor, women, and vulnerable group to get their concerns through public forum. In Cambodia, about 65 percent of agricultural labor and 75 percent of fisheries production are by Chea Vannath, CSD President, at the 2 nd Regional Conference on Poverty Strategies, 10/16-18/2003, Phnom Penh, Cambodia 6

7 in the hands of women. Poverty reduction will not be successful unless the big portion is included in the process. We have to promote gender equity. Also, the freedom of expression, freedom of speeches, freedom to have peaceful demonstrations need to be encouraged and guaranteed by the law. To be able to achieve the full people participation, there is a need for changes: (1) of the attitude, from being Fonctionnaires, or the authoritarian masters of the people, to civil servant or friendly servants of the people ; (2) to the Public Administration as a service, and the people as the client. (3) for practical reason, we need to have an easy and less costly access to public service; (4) One-stop shop public service within a day-trip distance for all. Any plan to build public facilities for the poor and people in remote area need to take into account the lack of transportation, and communication, facilities. Public offices such as medical centers, schools, markets, etc. need to be close to each other. Gender balance in the work place should be promoted by Equal Opportunity and Affirmative Actions policies and procedures to bring more women into decisions making positions. No speeches are louder than to have more and more women role models. In the Cambodian tradition and culture, and I am sure in other countries as well, there is a saying that our mother is our first teacher. Therefore, to be a good teacher, women need to be educated themselves. Without the participation of women, the poor, and the vulnerable, the Cambodia membership to the WTO, and ASEAN, are nothing else than the maldistribution of the national resources, then further impoverishment of the country and its people. V. CONCLUSION The range of pressing concerns and areas in need of reform in Cambodia today can appear overwhelming; from issues of land ownership and resource management of forests and fisheries, to social welfare concerns such as HIV/AIDS, drug trafficking and abuse, woman and child trafficking, poverty and violence, to the need to seriously address the ongoing problems of corruption, and border issues with our neighbors. It is clear that in order to address this daunting list of social issues, and for such a massive undertaking to have a hope of success, it will be necessary for all elements of society-the government, civil society, and the people-to work together and express their differences and ideas in an atmosphere of trust. The trust that all leaders can by Chea Vannath, CSD President, at the 2 nd Regional Conference on Poverty Strategies, 10/16-18/2003, Phnom Penh, Cambodia 7

8 build on is based on the Buddhist ethical and moral frameworks. Buddhist principles and precepts are mirrored in the components of good governance. Good governance is a western concept, but Buddhist principles and precepts are easier for Cambodians to related to, to achieve the same common goal. BUDDHIST PRINCIPLES AND PRECEPTS In Buddhism, there are four fundamental principles: loving kindness (metta), compassion (karuna), sympathetic joy (mudita) and equity and justice (ubekha). These apply not only to ordinary people but also, and especially, to the leaders of all sectors of society. Additionally, there are five Buddhist Precepts, which lay people can observe as their way of life. The first precept is RESPECT OF LIFE, in which, in addition to its obvious meaning, means respecting human rights and democracy, preserving wildlife and fisheries where the lives of the poor and the destitute depend on. The second precept is RESPECT OF OTHER PEOPLE S BELONGINGS, which means people shall not misappropriate other people s belongings, and respect for private property rights. It implies respect for individual rights. In government, it guards against corruption as it reminds leaders that they should not use their authority to misappropriate the resources of the governed. The third precept is HEALTHY BODILY BEHAVIOUR. Outside of its meaning for marriage, this precept means no rape, and no trafficking of women and children. It implies gender awareness and fairness, and equal opportunity and justice for all in the workplace. It also means better control of the spread of HIV/AIDS. The fourth precept is HONESTY. We all know the suffering and misery caused by distorted information. It means promoting good governance, transparency and accountability. It reminds us to learn to listen in order to understand the needs of the people. It teaches us to build trust between the government and the people. This trust is especially important when any country undertakes a process of reforms. The fifth precept is NO EXCESS OF DRINKING, which means adopting a healthy way of life, a life with no drugs, or alcohol. This precept can keep children away from drugs, and bad influences. At a governmental level, it means legislative restrictions on the advertising alcohol, cigarettes, and casino gambling in public places. The Government should not encourage gambling activities for the purposes of collecting taxes from these gambling activities. by Chea Vannath, CSD President, at the 2 nd Regional Conference on Poverty Strategies, 10/16-18/2003, Phnom Penh, Cambodia 8

9 Buddhism offers a way of life that avoids both the uncontrolled satisfaction of human desires and extreme forms of self-denial. The Buddhist Path consists of (1) knowledge of the truth; (2) the intention to resist evil; (3) saying nothing to hurt others; (4) respecting life, morality, and property; (5) holding a job that does not injure others; (6) striving to free one s mind of evil; (7) controlling one s feelings and thoughts; and (8) practicing proper forms of concentration. Each society must look to its own moral and ethical value systems, and yet in alleviating poverty we must look for common ground and common goals. I believe that Buddhist scriptures provide a framework for ethical leadership and sound principles for the alleviation of poverty. It gives us a path to freedom from the cycles of desire, which encourage the exploitation of both people and natural resources. It is a moral conduct in which it promotes a more humble and sober way of life, and directly challenges the greed of the few that underlies the poverty of so many. The Center for Social Development (CSD) is a non-governmental organization, advocating good governance through the institutionalization of democratic values and principles. CSD support justice, social equity and sustainable economic development by building citizens participation in the democratic process. Center for Social Development P.O. Box 1346 Phnom Penh, Kingdom of Cambodia Phone: (855) , Fax: (855) csd@online.com.kh Website : http// by Chea Vannath, CSD President, at the 2 nd Regional Conference on Poverty Strategies, 10/16-18/2003, Phnom Penh, Cambodia 9

UNDERSTANDING TRADE, DEVELOPMENT, AND POVERTY REDUCTION

` UNDERSTANDING TRADE, DEVELOPMENT, AND POVERTY REDUCTION ECONOMIC INSTITUTE of CAMBODIA What Does This Handbook Talk About? Introduction Defining Trade Defining Development Defining Poverty Reduction