Today, it is my great honor and pleasure to participate in this “20th Anniversary Celebration of the Cambodia-Asian Development Bank Partnership’’ with all Excellencies, ladies and gentlemen as well as national and international guests. Today’s event is another new historic moment to be held in Peace Building, which is the pride of our nation. On this auspicious occasion, on behalf of the Royal Government and People of Cambodia, I would like to join Deputy Prime Minister Keat Chhon in extending our warm welcome to H.E. Haruhiko Kuroda, President of the Asian Development Bank. His presence today clearly reflects the ADB’s high attention to firm friendship and close cooperation between the ADB and the Royal Government of Cambodia.
Taking this opportunity, I also would like to express our deep gratitude to the Management, Board of Directors, and staff of the ADB for providing twenty years of unwavering support to Cambodia in many sectors and all aspects. Allow me to recall some of the ADB’s colleagues with whom we have had excellent working relationships such as H.E. Mitsuo Sato, H.E. Tadao Chino, H.E. Haruhiko Kuroda, H.E. Stephen Groff, H.E. Lawrence Greenwood, H.E. Jin Liqun, H.E. Rajat M. Nag, H.E. Noritada Morita, H.E. Arjun Tappan, H.E. Kunio Senga, H.E. Suos Someth, H.E. Urooj Malik, H.E. Shyam Bajpai, H.E. Arjun Goswami, H.E. Putu M. Kamayana, and H.E. Eric Sidgwick.
Today’s event is being held at a time when Cambodia prepares for the successful completion of its responsibilities as the Chair of ASEAN. Such important gathering comes at an opportune time when Cambodia continues to enjoy the full peace, stability, security and cooperation. On the other hand, this event is convened in the aftermath of the global economic and financial crisis; the difficult situation that required the protection of its sovereignty and territory; the worst flood disaster in the recent past, and it is also taking place while Cambodia steps into the track of inclusive and robust economic growth with equitable development.
Indeed, Cambodia has become an equal member in other organizations in the sub-region, region, intra-region and globe over the past twenty years. Currently, Cambodia is moving on its right track towards inclusive and sustained economic growth which is for the maximum benefit of all Cambodians. In addition, with unflinching commitment and great efforts of the Royal Government and people of Cambodia as well as valuable contributions of development partners, Cambodia has experienced significant developments in all political, economic, social and cultural spheres.
Taking this opportunity, allow me to highlight a number of momentous achievements made by the Royal Government so far during the last two decades:
i) Peace, political stability, security and social order which lay the foundation for the pluralist democracy have been built. The free and fair commune elections were held 3 times in 2002, 2007 and 2012. The General Elections were held 4 times in 1993, 1998, 2003 and 2008.
ii) Respect for human rights and dignity, including political, economic and social rights, has been enhanced. Decentralization and de-concentration reform, aimed at strengthening democracy and efficiency of local public services, have been initiated and implemented.
iii) Good governance through state reforms, especially civil service reform, public financial management reform, decentralization and de-concentration reform, legal and judicial reform and other relevant reforms, have been strengthened to ensure that all government activities are increasingly more transparent, accountable, predictable, effective and efficient.
iv) Steady macroeconomic stability and considerable economic growth of 9% per year have been achieved for nearly a decade before the very difficult global financial crisis. In some years, Cambodia was experiencing double digit economic growth while keeping in check low inflation and a stable exchange rate. The Royal Government also achieved the poverty reduction rate of over 1% per year. Competitiveness of the national economy has been strengthened by improving agricultural productivity, building a rural economic base, and expanding the industrial sector, especially furthering the garment sector’s dynamics, and diversifying the industrial sector. At the same time, the service sector has also been expanded rapidly. Consequently, these have created jobs and skills training for hundreds of thousands of youth.
v) Through the “Public Financial Management Reform Program”, budget credibility has been enhanced as reflected on substantial growth in government revenues and the rationalization of expenditures, especially the increases in the current budget surplus. This contributes to expanding investment in the economic and social infrastructures aimed at enhancing public service and poverty reduction.
vi) The rehabilitation and construction of the major national road networks have almost been completed and the attention is now being paid to accelerate improvement of provincial and rural roads. The transport services including shipping services, commodity deliveries, multi-modal transport services, and good supplies and logistics have played an active and effective role in sustainable economic growth. The infrastructure, namely road, irrigation, energy and telecommunication has been significantly improved.
vii) The institutional and human resource capacity has been strengthened by focusing on the development of the education and health sector. The considerable progress has also been made in social sector. In the education sector, school enrolment rates have increased, and drop-out and repetition rates have declined. In the health sector, infant and child mortality rates, and HIV/AIDS infection rates have also fallen.
viii) The Private sector, as the “true engine of economic growth”, has made a very impressive contribution to socio-economic development in both the economic and financial sector. To enhance the involvement of private sector, Financial Sector Development Strategy (FSDS 2006-2015) and FSDS 2011-2020 have been formulated and implemented. Meanwhile, the progress of preparation and implementation of other principles and legal frameworks, which are required from WTO, is at a remarkable level.
ix) Partnership with all relevant stakeholders, particularly official development partners including ADB, private sector and civil society has been strengthened by putting in place a range of effective mechanisms, allowing for gathering of both financial resources and knowledge and for coordination of financial assistance and investment.
Based on the steady macro-economic stability and high average economic growth, the Gross Domestic Product (GDP) per capita has increased to over 4 times from approximately 200 USD in 1992 to nearly 1,000 USD in 2012. With this current growth trend, Cambodia expects that the GDP per capita will increase to over 1,000 in 2013. The poverty rate has declined from 50% in 1992 to be at around 20% in 2012, and this rate is approximately expected to be at 19% in 2013. Consequently, Cambodia is assessed as the 15th country that achieves high economic growth in the world in the last 10 years; the 5th country among the world’s developing countries that has significant achievements towards meeting its Millennium Development Goals (MDG); and the 1st country in Asia-Pacific that makes substantial progress in improving social indicators.
Above major achievements are resulted from:
i) The successful implementation of “Win-Win Policy”, that dismantled the political and military organizations of the Khmer Rouge, has begot the integration of former Khmer Rouge soldiers into the mainstream of the Cambodian society in 1999. Since then, the peace, political stability, security and social order have been strengthened and this establishes the prerequisites for any socio-economic development.
ii) “Triangle Strategy” was formulated and implemented by focusing on (1) building peace, restoring stability and maintaining security for the nation and the people; (2) integration of Cambodia into the region and normalization of relationships with the international community; and (3) promoting economic and social development. Through the success in implementing “Triangle Strategy”, ever since 1999, Cambodian people have experienced full peace, political stability, legal and social order, democracy, respect for human rights, and economic stability.
iii) Socio-Economic Development Plan (SEDP-I, 1996-2000) and (SEDP-II, 2001-2005) was formulated and implemented by aiming at sustained economic growth and poverty reduction. Under this development plan framework, two significant policy development initiatives have been formulated and put into practice by the Royal Government namely: (1) the “Cambodian Millennium Development Goals” with the aim of poverty reduction and human development, (2) “National Poverty Reduction Strategy”.
iv) “Rectangular Strategy, Phase I” for Growth, Employment, Equity and Efficiency following the “Triangle Strategy” is a strategy of the Royal Government in the Second Legislature of the National Assembly. Following the directions in the conceptual framework of “Rectangular Strategy, Phase I”, the third five-year national development plan, “National Strategic Development Plan 2006-2010” has been formulated and implemented.
v) “Rectangular Strategy, Phase II”, as the fundamentals of the socio-economic policy agenda of the Royal Government’s policy in the fourth Legislature of the National Assembly (2008-2013), was formulated and implemented. The “Rectangular Strategy, Phase II” was formulated and adopted based on practical experiences in the implementation in the Third Legislature of the Royal Government; people’s aspirations and willingness; national and international context; and prioritization of the Royal Government’s key sectors. Under this strategic framework, the “National Strategic Development Plan Update 2009-2013” has been prepared and implemented.
As Deputy Prime Minister Keat Chhon, Minister of Economy and Finance mentioned earlier on the notable achievements of the 20-year cooperation between the Royal Government of Cambodia and ADB, Cambodia has received a huge amount of ADB’s financial assistance with a total of nearly USD 2 billion for the development of the Government’s priority sectors. On behalf of the Royal Government of Cambodia, I gratefully acknowledge that our progress since 1992 has been made possible largely by active support from ADB and our other development partners. Through our past cooperation experience, we value ADB as a competent, experienced and successful development partner at the stage of Cambodia’s peace-building, restoration, and reconstruction. I have noticed that there are a few key factors that characterize the successful and well-grounded Cambodia-ADB partnership:
1) ADB respects Cambodia’s full ownership and responsibility to develop and implement its own priorities and reform programs responsive to long-term interests of Cambodian people. ADB successfully aligned its own strategies and financial assistance programs to be consistent with the priorities and country development strategy of the Royal Government. Indeed, sustainable economic development requires joint efforts between the Government and the development partners, but the Government must be the owner of all reform sites. I wish to confirm that ADB financial assistance provided to date has been in line with the priorities set out in the Royal Government’s Triangle Strategy, Rectangular Strategy and National Strategic Development Plan. In this spirit, I am optimistic that ADB will further strengthen the spirit of ownership and responsibility of the Royal Government in preparing and implementing Cambodia’s strategic development in the next 20 years.
2) ADB is always able to timely and effectively respond to Cambodia’s recent challenges with quality outcome by providing enormous concessional loans, grants and technical assistances timely with no intricate. Obviously, the success of urgently addressing the severe flood disaster in 2000 and 2011 was stemmed from the firm support of the ADB through providing highly concessional loans timely for the rehabilitation of the flood-damaged infrastructure. ADB provided loan funds of nearly USD 56 million for the “Flood Emergency Rehabilitation Project in 2000” and about USD 55 million for the “Flood Damage Emergency Reconstruction Project in 2011”. Meanwhile, ADB’s timely response during the severe stage maintained Cambodia’s economic stability, and especially the normalcy of livelihoods of the people. Therefore, this indicates the ADB’s strong cooperation in maintaining Cambodia’s economic situation and charitable affairs, and it also demonstrates that ADB is one of our good partners during challenging periods. On behalf of the Royal Government, People of Cambodia, and myself, I would like to convey my deep gratitude to ADB for providing its technical and financial development assistance and humanitarian aid to help restoration and development after the flood. I am calling up to further this kind of activity in the future.
3) ADB, as a regional multi-financed institution, always displays common understanding of challenges and development needs of the region as well as regional member countries, and accordingly strives to be responsive to them. The development gap among regional countries still continues to pose significant challenges to ensuring competitiveness and to achieving regional integration. To address these constraints, ADB has provided its vision, set strategies, and initiated long-term programs to ensure sustainable development for regional countries. ADB has initiated the Greater Mekong Subregion (GMS) Cooperation Program for six Mekong countries, including Cambodia. In addition, ADB has supported the implementation of this program through further investing in both hard and soft infrastructure. In this sense, I highly appreciate a prominent role and assistance provided by the ADB, our trusted partner, in supporting a number of flagship projects aimed at promoting Cambodia’s internal integration and connectivity to neighboring countries in the region. This is a key success for enhancing the investment, socio-economic development, and poverty reduction.
The important occasion to celebrate the 20th anniversary today reminds me of my vivid memories of the past relations with the ADB’s management. First, the ADB’s sixth president is H.E. Mitsuo Sato who died in 2002 at the age of 69. I still remember that, in 1997, while Cambodia’s political situation was still in turbulence, H.E. Mitsuo Sato’s courageous visit here was for opening the Bank’s Cambodia Resident Mission. His visit was clearly evident that the ADB’s management was highly committed to find ways to assist Cambodia while it was in high demand of maintaining political stability as well as country’s restoration, construction and development.
Then, the ADB’s seventh president is H.E. Tadao Chino, who died in 2008 at the age of 74. He also visited Cambodia in 2000 while the country was facing with the flood disaster. During his visit, ADB also provided the Royal Government with concessional loans totaling of about USD 56 million. Thereafter he facilitated the financing agreement for the “Flood Emergency Rehabilitation Project in 2000” to be effective just 1 hour after having the agreement got signed. Cambodian people are indebted to ADB, a very close partner who stands ready when Cambodia needs its support, for this charitable deed. In 2002, H.E. Tadao Chino also attended the first “GMS Summit” which was initiated by Cambodia to be held in Phnom Penh. At that time he expressed his willingness and strong commitment to support the development of Cambodia. Taking this opportunity, I would like to convey my condolence for the passing of both H.E. Mitsuo Sato and H.E. Tadao Chino, and I also would like to gratefully and sincerely thank for their contributions to Cambodia.
During the mandate of H.E. Haruhiko Kuroda, since 2004, it can be seen clearly that the collaboration between the Royal Government of Cambodia and ADB has considerably improved. I am delighted to have closely worked with H.E. Haruhiko Kuroda during his many visits to Cambodia. I also remember that in February 2008, I and H.E. Haruhiko Kuroda were on the same helicopter to preside over the Grounding Construction Ceremony of rehabilitation of the railway under the GMS Rehabilitation of the Railway in Cambodia Project. This project is financed by ADB in the amount of about USD 84 million along with the co-financing from other development partners. May I take this opportunity to request H.E. Haruhiko Kuroda to enhance the project progress and its completion so that Cambodian people will be sooner beneficial from this project. In late March and early April of this year, H.E. Haruhiko Kuroda joined the “16th Meeting of ASEAN Finance Ministers” and other important regional meetings in Cambodia, and also provided Cambodia with a concessional loan of USD 55 million to finance the “Flood Damage Emergency Reconstruction Project in 2011”.
On this occasion, I would like to inform the gathering that with the ADB’s support, the Royal Government of Cambodia, assisted by the Supreme National Economic Council (SNEC), a leading institution, is now preparing the strategic document namely “Cambodia Vision 2030” with the aim at propelling our nation from a “Low Income Status” to a “Lower Middle Income Country” in the next few years and a “Upper Middle Income Country” in 2030. Thereafter, Cambodia is aiming to be a “Developed Country” in 2050 without being trapped in “Middle Income Countries” classification. To achieve both objectives, Cambodia needs to accomplish sustained robust economic growth in an average of over 7% per year in the long run with equitable distribution.
In this regard, I would like to express my profound thanks to the ADB for providing support in the preparation of the strategic document “Cambodia Vision 2030”. I would like to further request the Bank to gather any resources including finance and knowledge from internal ADB and other external sources to absolutely achieve the Royal Government’s ambitious goals in 2030 and 2050.
I feel confident that the ADB, with H.E. Haruhiko Kuroda as current president, will continue its support to Cambodia through strengthening cooperation on priority sectors for Cambodia’s socio-economic development. In this spirit, I very much appreciate the willingness and full commitment of ADB to align future activities in Cambodia with the country’s planning cycle, and I strongly believe Cambodia will Cambodia and the ADB will achieve another twenty years of strong relation, and close collaboration.
In conclusion, I would like to wish H.E. Haruhiko Kuroda good health and happiness to lead the Bank more successfully and victoriously, and I wish the future Cambodia-ADB cooperation be crowned with bright success. I also would like to wish all Excellencies, ladies, and gentlemen good health and success in all of your endeavors.