While Cambodia has experienced substantial growth in recent years, the agriculture sector, which continues to play a critical role in growth and poverty reduction in the country, has gotten lesser attention and priority compared to the tourism and garment industries.
Cambodia was one of four case studies, together with Bangladesh, the People’s Republic of China (PRC), and Tajikistan, in the evaluation of ADB’s USD12.2 billion support for agriculture, natural resources, and rural development in 2005–2017. These countries accounted for a significant share of ADB’s sector portfolio during the evaluation period.
“In our efforts to advance our engagement in the agriculture sector, it is important to seek the lessons and learn from the experience of past projects. One lesson sphere that has been recurring in the sector, which considerably improves performance, is on strengthening institutional capacity and addressing the difficult sector context and complexity in designing the projects,” says Mr. Andrew Brubaker, team leader of the evaluation.
ADB’s efforts to strengthen Cambodia’s agriculture value chains—adding value to inputs along the supply chain—through policy reforms have potential. The financing for the ongoing Climate-Resilient Rice Commercialization Sector Development Program is structured to help farmers in Battambang, Kampong Thom, and Prey Veng both increase production and efficiency along the rice value chain, and address policy constraints for these value chains to function smoothly. This is part of a group of ADB-supported value chain projects in Cambodia and neighboring countries to increase agricultural competitiveness in selected regions along Greater Mekong Subregion transport corridors.
The evaluation noted that Cambodia is underinvesting in agriculture research, which is notable in some economies in Asia. The use of outdated equipment and facilities is compromising the volume and quality of research outputs. Since 2000, most of the growth in agriculture spending in Asia, including for agricultural research, has been driven by the PRC, India, and Indonesia.
ADB is stepping up its support for agriculture at a critical time for the sector. “Continuing to focus support for agriculture production and food security on building and upgrading infrastructure will not be enough to address Asia’s complex and evolving challenges on both,” said Deputy Director General of Independent Evaluation at ADB Ms. Véronique Salze-Lozac’h. “Agriculture systems across the region are increasingly centered on value chains, and the private sector is having a greater influence and responsibility for production and food security. Support for agriculture by governments and their development partners will need to be more comprehensive and take account of issues beyond production.”
Countries across Asia are facing similar challenges and in response, the share of annual ADB lending to agriculture increased from 2% in 2007 to 12% in 2017. The evaluation found that ADB has the potential to make a substantial contribution to the sector. The performance of ADB-funded projects is improving but results have been modest. The increased lending has generally supported larger operations, with a focus on water-related infrastructure. While this support is still needed, particularly to address the effects of climate change, there is also a need to support agricultural value chains and private sector development as regional demands change.
ADB-supported agriculture projects in Cambodia were broadly focused on poverty reduction and rural development, with an emphasis on rehabilitating irrigation, enhancing flood control infrastructure, supporting smallholder farmers, and building resilience to climate change. This emphasis reflects the need to make further progress in reducing poverty and to support Cambodia’s efforts to mitigate the climate crisis. ADB also provided substantial investments for emergency food assistance for government social programs during the 2008 global food price crisis.
The issues and challenges emerging in Cambodia are similar to those found across the region. Major challenges for ADB-funded agriculture projects often stem from issues in project design and sustainability due to weak institutions and insufficient provisions for operation and maintenance.
But there were notable bright spots. ADB’s work in the Tonle Sap area—where it is partnering with the International Fund for Agricultural Development to make the most of the fund’s expertise in working with poor farmers—is having positive results. The Tonle Sap Poverty Reduction and Smallholder Development Project, which started in 2009, is supporting the government to foster community-driven development through investments in rural infrastructure, productivity improvement, capacity development, and improved access to finance for smallholder farmers./.