Kingdom of Cambodia
Nation Religion King
Opening Address
by
Sr. Minister KEAT CHHON,
Minister of Economy and Finance
At the
Joint Royal Government of Cambodia, World Bank,
ADB, DFID and UN Conference to
Launch the National Poverty Assessment 2006
Intercontinental Hotel, 16 February 2006
- Samdech Prime Minister,
- Your Excellencies, Ladies and Gentlemen:
1. Today, we are most honored to have Samdech Prime Minister Hun Sen here
among us to deliver a keynote address to this joint conference to launch
Cambodia Poverty Assessment 2006.
2. Allow me first to extend my best wishes and warmest welcome to Samdech
Prime Minister Hun Sen. I would like also to welcome and thank Colleagues in
the Royal Government, the Ambassadors and Representatives of the bilateral
and multilateral development community, civil society and private sector for
their participation in this conference. I highly appreciate the World Bank,
ADB, DFID and the UN for their collaboration with the Government in
organizing this conference. My special thanks would also go to the team (the
WB and Cambodian Researchers) for their efforts in terms of time and wisdom
exerted in the preparation of this first comprehensive Cambodia Poverty
Assessment. I would like also to thank to Supreme National Economic Council
for its substantial contribution in reviewing and making comments to this
paper.
3. The Royal Government of Cambodia has always committed to poverty
reduction. Poverty reduction is the core at every development policies and
strategies of the Royal Government. The Rectangular Strategy, initiated by
Samdech Prime Minister Hun Sen, specifically targets economic growth, full
employment for Cambodian people, and equitable distribution of fruits of
growth thus ensuring social justice, and strengthened efficiency of the
public sector through the implementation of various in-depth and
well-coordinated reform programmes.
4. This joint conference will further discuss the findings of the report and
will try to explore innovative ways forward especially in setting the agenda
toward 2015 for the strong partnership in reaching the Cambodia Millennium
Development Goals (CMDGs).
5. Cambodia has made impressive strides over the past decade in keeping the
macroeconomic sustainability. The 7 percent growth in 2005 is beyond our
expectation, given the ending of Multi-Fiber Agreement system and severe
external shocks, such as a record high oil price and epidemic diseases.
During the last decade, the annual average of economic growth amounts to
over 7% at constant price, while the per capita income growth was 4½ percent
per annum at constant price.
6. Fiscal performance in 2005 was good, with both improved revenue
mobilization and expenditure rationalization. Domestic revenue in 2005
reached 11.7 percent of GDP, compared to 7.6 percent in 1995. Tax revenue
increased from 5.3 percent of GDP in 1995 to 8.7 percent 2005.
7. As for our public finance policy, we have focused on tightened
expenditure, budget discipline, and systematic expenditure rationalization.
The 2005 Budget has been implemented with extreme prudence and caution to
make room for priority spending: education, health, civil service reform and
the overhaul of physical infrastructure including the irrigation systems.
8. The growth will also benefit from the various reforms being decisively
implemented by the Royal Government. Those include Public Financial
Management Reform, Financial Sector Development and Private Sector
Development particularly through the improvement in business environment and
investment climate, trade facilitation and SMEs development, as well as Land
Management Reform, Administrative Reform, and Legal and Judicial Reform.
9. Moreover, the Royal Government attaches great importance on human
resource development. We give top priority to social spending, which has
been witnessed by steady increase in the sector allocation. Our focus on
education has resulted in more schools and well-trained teachers, lower
direct costs to households, and increasing primary enrolment rates.
Moreover, significant progress has been also achieved in the health sector.
Key health indices have shown steady improvement but they are still lagging
in some areas and exceed those in neighboring countries, such as those on
child malnutrition and maternal mortality.
10. Under the Multilateral Debt Relief Initiative, the IMF Executive Board
approved in December 2005 debt relief for Cambodia. As part of the
Initiative, the IMF will provide 100 percent of debt relief on all debt
incurred by Cambodia to the IMF before January, 2005 amounting to US$82
million. I wish to emphasis that Cambodia is qualified for IMF debt relief
because of her recent overall satisfactory macroeconomic performance,
progress in poverty reduction, and improvements in public expenditure
management. The Royal Government will use the saving from this debt relief
to finance public investment projects targeting the poverty reduction in
Cambodia, as stated in the National Strategic Development Plan adopted on 27
January 2006.
Samdech Prime Minister,
Excellencies, Ladies and Gentlemen:
11. On the road of growth and poverty reduction, Cambodia is facing
tremendous challenges. The Royal Government has exerted its utmost efforts
and is determined to overcome all these constraints. As a result, the
following positive developments can be observed:
1. The economic diversification through the development of agriculture,
agro-business and investments in irrigation has delivered results reflecting
in higher agriculture growth.
2. In recent years, we have made sustained efforts to bring together all the
stakeholders and harmonize their activities in every sector under the
Ministry-led sector-wide strategies, and the works have also begun to
deliver results.
3. The Government has now embarked on an ambitious but feasible program of
public financial management (PFM) reform, tackling some of the binding
constraints on improving service delivery.
4. Similarly, the Royal Government is committed to reforming the
institutions and procedures for trade facilitation including single
administrative documents, risks management, and “one-stop-service”
operation, creating the environment facilitating businesses and investments.
5. Cambodian NGOs are becoming increasingly capable and sophisticated as
contributors to national development, both as partners in service delivery
and as institutions for channeling ideas to policy makers.
6. “Cooperation community” is now working on harmonization and realignment
of their programmes to meet Cambodia’s needs, while facilitating Cambodia
ownership over her own development and reform efforts.
7. Finally, the Royal Government has now in its disposal the National
Strategic Development Plan which lays out an integrated, strategic approach
to achieving the MDGs.
12. The recent political developments underlie our robust optimism in the
continuing socio-economic progress of Cambodia. The achievements were
possible thanks to the strong confidence and commitment of the Royal
Government to its development partners including the Private Sector,
Cooperation Community, and NGOs. The participatory approach that the Royal
Government has adopted has proved to be a winning approach which we will
continue to pursue in the future.
13. Finally, the conference will listen to the Keynote Address by Samdech
Prime Minister of the Royal Government of Cambodia!
Thank you !