By Mehmet Enes Beşer
There has been a long vision of a more radiant future conceptualized for Cambodian economic transformation into an upper-middle-income economy by 2030 and a high-income economy by 2050. Visions are consistent with Cambodia’s revolutionary turnaround from half a century of war and turbulence and irrevocable dynamism over the last two decades of poverty alleviation and social advancement. But in the current uncertain and complicated world economy, there are no more these traditional growth channels to go back on in a bid to envision its Cambodia vision fulfilled. It will be pushed onto the path of inclusive, shock-proof, and sustainable growth if it is to fulfill its dream.
Cambodia’s new wealth has been driven by an extremely narrow basket of sectors—tourism, construction, garment export, and agriculture. Despite all the prosperity this combination has experienced in terms of employment creation and foreign investment inflows, the economy has similarly been exposed. The COVID-19 pandemic, natural disasters, and global trade flow realignments all showed the manner in which external shocks can make Cambodia’s economic engine come to a standstill in an instant. Most fundamentally, growth has not accrued in an equal proportion. There have long been imbalances in the urban-rural connection, so widespread has entrenched youth unemployment and gender-based discrimination grown. Prior to its ability to jump forward towards an above-diversified path of growth, Cambodia needs to develop people first.
Learning is sporadic and skill shortages disadvantage youth employment as well as next-generation productivity. Expansion of vocational training access, updating the curriculum to 21st-century standards, and providing computer literacy—particularly in rural areas—will become the issue of utmost importance in preparing the workforce for more diversified and value-added economies. Women, minorities, and the handicapped in the workforce must be treated in special ways so that they do not fall behind the mainstream. There should be health infrastructures’ consolidation. The crisis highlighted social protection and health infrastructure deficits whose negative impacts had been disproportionately borne by the poor and vulnerable. Health universal coverages provision, enhancing maternal and child health, as well as investing in preventive health, enhance welfare as well as productivity.
Environmentally, it is one of need rather than discretion. Agricultural dependency and vulnerability to climatic perils like floods and droughts have made Cambodia the most climate risk-vulnerable country in the region. Land degradation, forest cover loss, and fish resources depletion are also imperiling sustainable long-term livelihood and food security. In development, the nation has to endeavor to go for green growth with concomitance to development and nature protection.
They encompass green investment in energy, promotion of climate-resilient agriculture, setting up sustainable land and water management, and conservation of biodiversity.
Cambodia has already begun incorporating the green economy principles into its National Strategic Plan on Green Growth and into being mainstreamed into international climate policy agendas. The necessity is to speed up and scale up application of these plans into development planning. Its key focus areas are promoting green investment, environmental management, and public participation in conservation. Cambodian economic resilience is the medium-term agenda of the country as well. This includes diversification of production and export as a de-risking strategy in order to lessen dependence on the garment and tourism industries. There are opportunities in agro-processing, electronics assembly, logistics, and IT-enabled services but as long as there is quality infrastructure, regional connectivity, business facilitation, and institutions that encourage innovation and entrepreneurship.
Building the digital economy, for example, is a challenge and opportunity. Cambodia has grown gradually in mobile phones and e-commerce, but digital infrastructure remains uneven and regulatory institutions remain under development. Supporting the digitalization of small and medium-sized enterprises (SMEs), strengthening data protection, and pushing the internet further into poor communities will be the most powerful drivers of building a future-proofed economy.
Reform in governance will also be needed. Good institutions openly provided public services, and good rule of law need to be established in order to foster investor confidence, reduce corruption, and provide equal access to opportunity and services. Decentralization and people-centric development can also make the system more responsive and inclusive.
Conclusion
Cambodia’s own long-term aspirations are within its reach, but these are only possible through an united drive towards sustainable, inclusive, and resilient development. This shift is possible only on the foundation of human capital investment, the environment, economic diversification, and institutional capacity.
Its achievement will also be contingent not just on vision and perseverance of government policy, but also on foreign development partners, civil society, and the private sector. By creating a model of growth that is not just faster-growing, but also greener, more inclusive, and more resilient, Cambodia can set a course for development that will improve the lives of all Cambodians—today and in the generations to come.