Poverty in Cambodia

A charcoal seller in Phnom Penh
A charcoal seller in Phnom Penh

What does poverty mean in Cambodia? This is the simplest but the most difficult question to answer. Some people say, ‘Less money defines poverty’. Others say, ‘Lack of access to basic needs and services for human life defines poverty’.

In Phnom Penh, the capital city and the economic centre of the state, if you walk around today, you will find totally different levels of local life. Main streets are crowded with full of motorbikes, cars and sellers. Moto drivers call everybody they see at random to his motorbike taxi. Officials with smart suits sit in luxury car. Bread, fruit or snack sellers rush to sell out their stocks before it starts to rain. You might also find some people sitting beside roads or markets. Economically excluded people are completely lost in this modernising capital: elder women, blind men, men without legs and children with dirty cloths. Those people might be victims of the devastated conflicts for the past decades. But no excuse. They are now here, and begging. They are just begging. They are just put their palms together every day. That is all they can do. No one can help them. As noted at the beginning, it is not easy to ‘define’ exactly what poverty is in Cambodia. But we can ‘feel’ like they are poor. What can we do for them? Or do we not have to?

Development practitioners often use economic indicators to define Poverty. Cambodia employs two differential measurements: Food Poverty and Consumption Poverty. Food Poverty in Cambodia is defined by 2,100 calories per day on average as minimum food consumption for adult, which include both quantity and quality of food consumption. Consumption Poverty is more generally used to measure poverty in Cambodia. While Food Poverty does not take non-food goods into account, Consumption Poverty is calculated by summing up costs of minimum food and non-food consumption*. This is because even those who live in poverty need clothes, shoes or other necessary durables. Thus, Food Poverty is often described as ‘extreme’ poverty compared to Consumption Poverty as just poverty.

In accordance with the latest poverty indicator, 34 per cent, 21 per cent and 5 per cent of populations in rural areas, other urban areas and Phnom Penh, respectively, were identified below the poverty line, whilst 17 per cent, 13 per cent and 3 per cent of them in each region lived in food poverty in 2004. Although the poverty headcount ratio has significantly decreased over the decade, these statistical data implies geographical inequality in the degree of poverty reduction across the country. One major reason of this disparity may be drawn from the growth pattern of country’s economy. In fact, its growth was greatly led by urban-oriented industries, particularly garment and service sectors. As a result, the economic growth mainly took place in rural urban areas and Phnom Penh; therefore, a number of rural people were left behind its dramatic growth. Currently, 91 per cent of the total poor populations concentrate in rural regions in Cambodia.

Poverty indicators in Cambodia
Poverty indicators in Cambodia

How can poverty in Cambodia be eliminated? Economists might answer ‘economic growth’. Surely, it is needed. The country’s GDP is still not sufficient to reduce poverty. More work opportunities would provide the poor with more sustainable income. For this achievement, improving in access from rural areas to markets or urban areas is critically and urgently needed, so that 4 millions of the poor might be able to find the way out of poverty. Simultaneously, it is crucial to protect a group of economically inactive people due to chronic diseases, disability, ages and other factors of low capacity for income generation.

Poverty in Cambodia is not easily alleviated. But it is never impossible. Now that the country has achieved to sustainably increase its economy year by year, it is time to think about improving access from rural regions to economic centres and also protecting economically incapacitated people.

*Technically speaking, the Cambodia’s baseline poverty line consists of a single national reference food bundle and three regional non-food allowances. The baseline values are in 1993/94 Riel and refer to daily per capita levels of food and non-food consumption (World Bank 2006).

Chen, S. and Ravallion, M. (2007) Absolute Poverty Measures for the Developing World, 1981-2004. World Bank Policy Research Working Paper, Vol. 4211, The World Bank, Washington D.C.
Dollar, D. and Kraay, A. (2001) Growth Is Good for the Poor. World Bank Policy Research Working Paper, Vol. 2587, The World Bank, Washington D.C.
Kawani, N. and Pernia, M. E. (2000) What is Pro-poor Growth? Asian Development Review, 18 (1) Asian Development Bank
Devereux, S. and Sabates-Wheeler, R. (2004) Transformative Social Protection. IDS Working Paper, Vol. 232
World Bank (2006) Cambodia Poverty Assessment-Halving Poverty by 2015?

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