2006:2 Employment and Growth in Cambodia - An Integrated Economic Analysis

Susanna Lundstro¨m, Per Ronna°s
Serier – Sida EvaluationDescription:
This country economic report the explores the opportunities and binding constraints for enhancing employment and labour productivity in Cambodia against the backdrop of the country's rapidly growing human resource base. Starting from the assumption that improved employment and income opportunities for the poor provide the main avenue for reducing material poverty, the study applies an integrated approach to economic analysis by linking employment analysis with analyses of the business environment and of the macro-economic situation. A main conclusion drawn in the study is that high priority must be given to an intensification of agriculture in order to permit this sector to resume the role as a main contributor to employment and income generation, at least in the short to medium term. The present trend of agricultural stagnation is not only a cause of widening income and asset inequality and an immediate obstacle to poverty reduction, but is also a main constraint to a sustainable and broad-based development of the non-farm sectors of the economy. Corruption presents another acute constraint to pro-poor growth, while the lack of a skilled and well-educated labour force and the poorly developed financial sectors seem likely to emerge as increasingly important constraints. The present study is part of an on-going methodological work within Sida (a cooperation between the Department for Infrastructure and Economic Cooperation and the Department for Policy and Methodology) aimed at achieving a sharper poverty focus in economic analysis.
The study is part of a series of country studies, under taken by Sida itself and by various Swedish universities and research institutes in collaboration with Sida. The main purpose of these studies is to enhance our knowledge and understanding of current economic development processes and challenges in Sweden's main partner countries for development co-operation. It is also hoped that they will have a broader academic interest and that the collaboration will serve to strengthen the Swedish academic resource base in the field of development economics.