The UN’s latest evaluation of Cambodia states that the Kingdom has fulfilled the three basic conditions necessary for graduation from least developed country (LDC) status, including a gross national income (GNI) per capita of $1,377 which surpasses the $1,222 threshold, according to Minister of Planning Chhay Than.
“Cambodia started from zero in 1979 when it began its recovery and the rebuilding of the country’s socio-economy in the aftermath of the tragedy left behind by the Democratic Kampuchea [Khmer Rouge].
“The recovery and nation rebuilding have been contributed to by all aspects of our society and with the support from international community,” Than said at the workshop on preparing for a sustainable LDC graduation of Cambodia held virtually on January 17.
He said the workshop is the first of its kind and is meant to help prepare Cambodia to leave the LDC status. The workshop was co-organised by the UN in Cambodia, the Economic and Social Commission for Asia and the Pacific (ESCAP) and other relevant institutions.
Than said the progress came following the implementation of the win-win policy, which brought about peace – a necessary pre-condition for socio-economic development.
“The recovery efforts and development brought about large amounts of progress very quickly and enabled Cambodia to become “lower middle income” country in 2016,” he said.
He said the three criteria evaluated by the UN in 2021 include GDP per capita which currently stands at $1,377; the Human Assets Index – HAI at 74.3, which is higher than the requirement of 66; and an Economic and Environment Vulnerable Index of 30.6, still lower than the requirement of at least 32.
“Meeting the requirements to leave LDC is a turning point for Cambodia in our history and it shows the efforts towards nation building by the government and the support of the international community,” Than said.
According to Than, the second evaluation will be made in 2024 by analysing the three criteria mentioned in addition to reviewing the vulnerability profile and the ex-ante impact assessment. If all criteria are met, then Cambodia will request graduation from LDC status, which then takes effect three years afterwards or in 2027 at the earliest.
He said Cambodia will follow a National Smooth Transition Strategy to ensure that the country will not be suffering due to the graduation from the LDC status and the strategy will be enforced after the graduation.
However, he said, the progress made was measured before the start of the pandemic, which has had unprecedented impacts on socio-economic development, environmental development and other aspects of society such as tourism, manufacturing and the garment sector.
He said Cambodia’s recent economic growth of seven per cent each year had dropped to minus 3.1 in 2020, and its poverty rate had jumped to 17.8 per cent, mostly caused by loss of jobs in the garment, tourism and manufacturing sectors.
He said the decline in growth and the economy would have been much bigger if the government had not been prepared with a solid plan with 10 intervention packages and many other mechanisms in response or had not launched its Covid-19 vaccination programme.
Pauline Tamesis, UN resident coordinator, said at the workshop that Covid-19 significantly set back the country’s development progress and that Cambodia needed to accelerate its efforts at recovery from the pandemic and reduce its vulnerability and inequality in order to meet the graduation criteria again at the second triennial review in 2024.
However, she also said the crisis was also an opportunity for transformation.
“The pandemic provides a unique opportunity to transform Cambodia’s socio-economic development model to be more inclusive, sustainable and resilient,” Tamesis noted.
She congratulated the government for rolling out the “Strategic Framework and Programmes for Economic Recovery 2021-2023” which addressed key priorities with the pillars of recovery, reform and resilience.
She said the UN system’s commitment was to support the government’s efforts to implement the Recovery Framework, including help with the means of implementation.
“Sustainable financing for recovery and [sustainable development goals] will ensure collective efforts to recover better from the pandemic will accelerate [development goals achievements] and enable Cambodia to transition from LDC status in a smooth and sustainable manner,” she said.