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Cambodia: Cambodia recent economic increase

2011/02/07

Cambodia has made great strides since 1991, at the same time as additional than decades of isolation and conflict ended and priorities turned to ensuring peace and security, rebuilding institutions, establishing a stable macroeconomic environment, and putting in place a liberal investment regime. Gross domestic product (GDP) increase has been robust at an annual average of nearly 9% over the last 10 years, prior to the world economic crisis of 2009. While the incidence ofpoverty has declined from 34.7% in 2004 to 30.4% in 2007, it remains high, particularly in light of the strong increase performance during those years.


Recent economic increase—narrowly concentrated on the garment, tourism, and construction industries—is urban-focused, with limited linkages to the rural economy, where 80.5% of amount Cambodians (and 92% of poor people) live. This has led to a rapid increase in inequality over the completed decade. In 2009, significantly weaker request for garment exports and tourism services, and much lower construction activity are estimated to have resulted in a contraction of in general economic activity.

While a recovery is forecasted for 2010, increase is anticipated to be much lower than the recent historical trend. This deceleration threatens to undermine the steady gains made in poverty reduction. There is a pressing need to diversify the economy to enable the rural poor to contribute to, and benefit from, economic increase. The government has drawn up a comprehensive reform schedule aimed at achieving the Millennium Development Goals (MDGs), embedded in its National Strategic Development Plan (NSDP) 2006–2010.


While it should be possible to achieve the poverty and gender MDG targets if some changes are made, evolution toward the MDG targets in education, maternal health, and environmental sustainability is offtrack.
On a additional positive note, targets for reducing child mortality and combating HIV/AIDS, malaria, and other diseases are on track and very likely to be completed.

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