Cambodian Economy: Charting the Course of a Brighter Future - A Survey of Progress, Problems and Prospects

25. Accelerating Institutional Development - The Key to Progress

551 Chapter 25 Accelerating Institutional Development- The Key to Progress 25.1. General Development Framework During its second mandate, from 1998 to 2003, the RGC implemented the Triangular Strategy to focus on achieving peace and stability, normalizing relations with the rest of the world and marshalling resources to accelerate economic development and fight poverty. The strategy was successful in creating an environment conducive to progress, leading Cambodia on the path of reforms and sustainable development. Cambodia transformed from a backward country facing an uncertain future, and ravaged by war, conflicts, and instability, into a zone of lasting peace, security, and public order. However poverty and inequity in income distribution have emerged as the greatest challenges facing the nation. In order to quickly solve the poverty problem and reach the Millennium Development Goals (MDGs), the RGC launched, in March 2003 the National Strategy for Poverty Reduction, with the following objectives: • Strengthening peace, stability, and public order through the implementation of concrete measures aiming to improve the rule of law, promote respect for human rights and democracy, and create a political and security framework conducive to continued development. • Ensure a strong rate of sustainable economic growth, 6-7% per year on average. • Ensure an equitable distribution of spin-offs from the economic growth between rich and poor, urban and rural communities, men and women, and • Promote sustainable management of the environment and natural resources. The RGC’s agenda is not limited to fighting poverty. Its vision for development is one of social cohesion, with a state-of-the-art educational system and abundant cultural wealth. Making the vision into reality will require unfailing respect for the values of social justice, the interests of the people and their development, and the formulation and implementation 552 of enhanced poverty reduction policies based on sustainable economic growth and improved governance. To realize this vision Prime Minister Samdech Hun Sen launched, in July 2004, the “Rectangular Strategy for Growth, Employment, Equity and Efficiency,” as an economic platform of the Royal Government’s third legislature of the National Assembly. This strategy captures the key elements of the Millennium Development Goals, the National Socio-economic Development Plan of 2001-2005 (SEDP2), of the National Poverty Reduction Program of 2003-2005 (NPRP), and other reform policies, strategies, plans, and programs. Its objective is to encourage economic growth, generate employment for the Cambodian work force, guarantee equity and social justice, and improve the efficiency of the public sector through implementation of the Governance Action Plan for in-depth, coordinated, and consistent reforms at all levels and in all sectors. The Rectangular Strategy is an integrated structure of interlocking rectangles, as seen in the Figure 25.1: Figure 25.1. The Rectangular Strategy 553 The positive results obtained in implementing the Rectangular Strategy have strengthened the overall confidence in a bright future for Cambodia. The foundations have been laid for development of the private sector, trade, investment, and tourism sectors, all generators of employment and income for Cambodians. Progress has been made in reforming agriculture and strengthening social and physical infrastructure. In recognition of the overall success in implementing the Rectangular Strategy it has been decided to continue with the same socioeconomic agenda with minor modifications in the fourth mandate of the government. However the battle for securing Cambodia’s future is not yet won. Cambodia succeeded in achieving the targeted growth and reducing poverty appreciably during 1998-2008 but many challenges remain. The RGC is aware that there are numerous obstacles to overcome before achieving sustained progress and assuring lasting prosperity for the country and its people. The quality of institutions plays a crucial role in assuring sustained development and achieving a quick victory in the fight against poverty. Therefore, the government will pay special attention to accelerating institutional reforms in the following areas: (i) public administration reform; (ii) decentralization and local development; and (iii) legal and judicial reform. 25.2. Public Administration Reform Civil service reform has a broad aim: “the creation of a government workforce of the size and with the skills, incentives, ethos, and accountability needed to provide quality public services and carry out the functions assigned to the state.” The experience of global development shows that there is a strong correlation between the caliber of the government workforce of a country and its level of economic and social development. It is seen that certain countries in Southeast Asia, such as Singapore and Malaysia, have...