World Bank reviews progress in Country assistance strategy
Two years into the implementation of its Country Assistance Strategy (CAS) for Cambodia for 2005-2008, in early October 2007 the World Bank held a series of consultative meetings with the Government, development partners, private sector and civil society representatives to seek their feedback on CAS implementation so far and proposals for the future.
The purpose of the consultations was to get feedback on whether the stakeholders feel that the CAS remains relevant and is on track in its implementation or whether it needs some adjustments based on all that has happened in Cambodia during the last two years and the new knowledge that has been accumulated on Cambodia during this period. Based on these consultations, within the Bank and with external stakeholders, the Bank will prepare a CAS Progress Report to present to its Board of Directors in early 2008 laying out the proposed strategy and program for the future.
The CAS is intended to help implement the Government’s Rectangular Strategy and the National Strategic Development Plan (NSDP) for 2006-2010. These documents provide a sound diagnosis of Cambodia’s development challenges – particularly the central importance of good governance – and a comprehensive list of actions to tackle these challenges.
The World Bank, in its presentation, said that Cambodia has made progress on many fronts. It has enjoyed double digit growth during the last three years with continued high growth projected; poverty has come down from 47 to 35 per cent during the last decade, and the recent Equity Report shows that while inequality remains high, the gap between the rich and poor has stabilized in recent years and the fruits of growth are being shared more widely than in the first half of the last decade.
New data on education and health show that most indicators are improving (except the maternal mortality rate).
The garment sector has survived and is growing despite the lifting of quotas; tourism continues to boom; there has been a significant increase in Foreign Direct Investment, though largely in the natural resources sector; possibly significant volumes of off-shore oil and gas reserves have been discovered; there is the possibility of significant mineral wealth being discovered and exploited; and China has emerged as a major “non-traditional” donor.
These gains, however, remain fragile. The high growth is narrowly based and undiversified, concentrated on the garment industry, tourism and construction; though revenues have increased, the revenue- to-GDP ratio remains inadequate and well below the average for low-income countries; though there have been rapid gains in primary school enrollment, only half the children who enter primary school complete it, and dropout and repetition rates are very high; and large volumes of overseas aid are highly fragmented and concentrated on specific projects rather than in support of Government programs. Governance remains weak, as confirmed by global indicators such as Doing Business, Transparency International, and Governance Matters VI.
There have been accomplishments under all six objectives of the CAS, though of varying degrees: private sector development, public financial management, natural resource management, decentralization and deconcentration, formulation and implementation of the National Strategic Development Plan (NSDP), and attaining the Cambodian Millennium Development Goals (CMDGs).
The consultations provided very useful feedback on the way forward. All stakeholders urged the Bank to stay focused and selective and to deepen rather than broaden its engagement and program in Cambodia. Development partners felt that the current strategy was still relevant and appropriate and there was strong support for extending the current strategy till 2011 and then doing a new CAS—jointly with several other development partners—to align to the next NSDP for 2011-2015.
The private sector urged the Bank to continue to focus on private sector development as one of its core pillars of the CAS and to continue to work on reducing the costs of doing business in Cambodia, especially the costs imposed by trade facilitation agencies. Civil society members urged the Bank to pay more attention to building the capacity of civil society for research and policy dialogue, and to continue to create space for civil society members in policy dialogue through the technical working groups. They welcomed the Bank’s increased engagement with civil society and its new Program to Enhance the Capacity in Social Accountability (PECSA) and also its new Demand for Good Governance (DFGG) Project.
The Government asked the Bank to continue to focus and be selective in its program and also to incorporate the findings from recent analytical work such as the Poverty Assessment and the Equity Report when designing its future program. Further consultations will be held with the Government on the strategy and program for the coming years before the CAS Progress Report is finalized in the coming months.
World Bank Country Manager Nisha Agrawal reaffirmed to the participants at the consultation meetings that the World Bank’s vision remains the same: a Cambodia Free of Poverty by helping Cambodia to achieve its Cambodia Millennium Development Goals (CMDGs): to reduce poverty and hunger, achieve universal primary education, reach gender equality and empower women, reduce child mortality, improve maternal health, combat HIV/AIDs, malaria and other diseases, ensure environmental sustainability, and de-mining, UXO and victim assistance.
“For us, the focus on good governance in our CAS is a means to an end – and the end remains poverty reduction.
There is plenty of evidence from around the world that good governance will lead to a more sustainable and inclusive pattern of development and will lead to a better standard of living for all Cambodians, especially the poor,” she said.
(Source: The World Bank’s Newsletter: volume 5, number 11, November 2007)