Resource information
Over the seven years from 2004 through
2011, Cambodian economic growth was tremendous, ranking amid
the best in the world. Moreover, household consumption
increased by nearly 40 percent. And this growth was
pro-poor, not only reducing inequality, but also
proportionally boosting poor people's consumption
further and faster than that of the non-poor. As a result,
the poverty rate dropped from 52.2 to 20.5 percent,
surpassing all expectations. However, the majority of these
people escaped poverty only slightly: they remain highly
vulnerable, even to small shocks, which could quickly bring
them back into poverty. The main drivers of poverty
reduction were better prices of rice for farmers, better
wages for agricultural workers, increases in salary jobs for
the urban labor force, and better income for
non-agricultural businesses for rural households.
Improvements in health and education, as well as government
investment in infrastructure, provided a favorable
environment for the poor, allowing many of them to pull
themselves out of poverty. Looking forward, some of these
drivers of poverty reduction are likely to stall. Coupled
with increased vulnerability, the present conditions create
new challenges for the Royal Government of Cambodia.
Furthermore, most of the improvements in Cambodia originated
at very low values, thus leaving much work to better the
well-being of many Cambodian households. Outstanding gains
have been achieved, but it will take focus and further
actions to maintain Cambodia's future growth. Most
poverty in Cambodia is found in the countryside: about 90
percent of Cambodia's poor live in rural areas. To
generate the maximum impact, government policies should
concentrate on the productivity of the rural poor's
major assets: their labor and their land.
