TABLE OF CONTENTS Main Volume SECOND Five Year SOCIOECONOMIC DEVELOPMENT PLAN (2001-2005) MAP OF CAMBODIA............................................................................................................... i BASIC DATA ON CAMBODIA, 1998 ....................................................................................... ii EXECUTIVE SUMMARY ........................................................................................................ iii PART 1: VISION .............................................................................................................. 1 CHAPTER 1: THE PLANNING PROCESS AND DEVELOPMENT VISION ........ 1 1.1 PLANNING PROCESS ............................................................................................. 1 1.2 REVIEW OF SEDPI ............................................................................................... 2 1.2.1 ECONOMIC PERFORMANCE............................................................................. 3 1.2.2 SOCIAL DEVELOPMENT ................................................................................... 4 1.2.3 KEY LESSONS LEARNT FROM SEDPI ............................................................ 6 1.3 DEVELOPMENT VISION ........................................................................................ 7 1.3.1 CHALLENGES AND OPPORTUNITIES ................................................................ 8 1.3.2 ASSUMPTIONS AND RISKS .............................................................................. 9 PART II: OBJECTIVES ................................................................................................ 11 CHAPTER 2: THE DEVELOPMENT CHALLENGE: “POPULATION AND POVERTY DYNAMICS" .............................................................................................. 11 2.1 WHERE WE ARE ................................................................................................ 11 2.1.1 HIGH POPULATION GROWTH RATE .............................................................. 12 2.1.2 HIGH FERTILITY AND MORTALITY RATES ..................................................... 12 2.1.3 HIGH MIGRATION........................................................................................... 13 2.1.4 IMBALANCES IN AGE AND SEX STRUCTURE ................................................. 13 2.1.5 GENDER INEQUALITIES ................................................................................. 14 2.1.6 POPULATION DENSITY AND SELECTIVE POPULATION PRESSURE ............... 15 2.1.7 URBANIZATION AND URBAN-RURAL DIFFERENCES ...................................... 15 2.1.8 WORKFORCE PARTICIPATION ....................................................................... 16 2.2 POVERTY ........................................................................................................... 17 2.2.1 THE INCIDENCE OF POVERTY ....................................................................... 17 2.2.2 THE DIMENSIONS OF POVERTY .................................................................... 19 2.3 GENDER ISSUES AND POVERTY ......................................................................... 25 I CHAPTER 3: NATIONAL DEVELOPMENT OBJECTIVES ................................. 27 3.1 THREE MAIN PILLARS FOUNDED ON RANGE OF GOVERNANCE REFORMS ......... 27 3.2 BETTER GOVERNANCE ....................................................................................... 27 3.3 SUSTAINABLE BROAD BASED ECONOMIC GROWTH ........................................... 28 3.4 SOCIAL AND CULTURAL DEVELOPMENT ............................................................ 29 3.5 SUSTAINABLE USE OF NATURAL RESOURCES AND THE ENVIRONMENT ............. 29 PART III: STRATEGIES "PLAN TO ACHIEVE VISION AND OBJECTIVES" 31 CHAPTER 4: NATIONAL ECONOMIC GROWTH AND POVERTY REDUCTION STRATEGY ........................................................................................... 31 4.1 CONSIDERABLE POTENTIAL FOR REDUCING POVERTY ...................................... 31 4.2 IMPORTANCE OF GROWTH AND PRIVATE SECTOR DEVELOPMENT .................... 33 4.3 BETTER GOVERNANCE ....................................................................................... 33 4.4 MACROECONOMIC STABILITY IS CRUCIAL ......................................................... 34 4.5 DECENTRALIZATION .......................................................................................... 35 4.6 THE IMPORTANCE OF AGRICULTURE AND RURAL DEVELOPMENT ..................... 37 4.7 ENCOURAGING REDUCED FERTILITY AND SLOWER POPULATION GROWTH ...... 39 4.8 REDUCING GENDER BASED POVERTY ................................................................ 40 4.9 IMPROVING ACCESS OF THE POOR TO EDUCATION AND HEALTH ..................... 40 4.10 EXPANDING VILLAGE LEVEL INFRASTRUCTURE AND SERVICES ........................ 41 4.11 DISASTER PREVENTION AND MANAGEMENT ...................................................... 42 4.12 TARGETED SPECIAL PROGRAMS ......................................................................... 42 PART IV: POLICIES "BROAD GUIDELINES FOR DECISION MAKING" ...... 44 CHAPTER 5: FACILITATING DESIRED SOCIOECONOMIC OUTCOMES .... 44 5.1 ROLE OF THE GOVERNMENT ............................................................................. 44 5.1.1 MACROECONOMIC MANAGEMENT AND PROMOTING THE PRIVATE SECTOR ..... 45 5.1.2 MILITARY DEMOBILIZATION ........................................................................... 47 5.1.3 PUBLIC ADMINISTRATION REFORM ............................................................... 47 5.1.4 REFORMING PUBLIC EXPENDITURE MANAGEMENT ..................................... 48 5.1.5 MEASURES FOR THE ECONOMICALLY ACTIVE POOR .................................. 49 5.1.6 MAINSTREAMING GENDER ............................................................................ 50 5.1.7 BUILDING LOCAL GOVERNMENT CAPACITY .................................................. 50 5.1.8 IMPROVING THE HEALTH AND EDUCATION OF THE POOR .......................... 50 5.1.9 DEVELOPING BASIC PHYSICAL INFRASTRUCTURE ....................................... 52 5.1.10 POPULATION POLICY ................................................................................. 52 5.1.11 REDUCING TRANSITORY POVERTY ........................................................... 52 5.1.12 PROMOTING ECOLOGICAL AND CULTURAL TOURISM ............................... 53 5.2 MONITORING IMPLEMENTATION AND EVALUATING PERFORMANCE .................. 53 5.3 AID COORDINATION AND AID MANAGEMENT .................................................... 56 5.4 LINK TO VOLUME II ........................................................................................... 57 II Volume 2 SECOND Five Year SOCIOECONOMIC DEVELOPMENT PLAN (2001-2005) ANNEX 1: REVIEW OF FIRST SOCIOECONOMIC DEVELOPMENT PLAN 1996-2000 ......................................................................................................................... 58 1.1 ECONOMIC PERFORMANCE ................................................................................ 58 FISCAL DEVELOPMENTS ............................................................................................ 62 MONEY, PRICES AND THE EXCHANGE RATE ............................................................. 64 EXTERNAL TRADE AND THE BALANCE OF PAYMENTS ............................................... 65 1.2 STRUCTURAL REFORMS ..................................................................................... 67 1.3 SECTORAL DEVELOPMENTS ............................................................................... 68 Box 2: SEDP-I Agricultural Development Goals ................................................ 69 TOURISM .................................................................................................................... 73 Box 3: SEDP-I Tourism Policies ........................................................................... 74 TRANSPORT AND COMMUNICATIONS ......................................................................... 76 POWER ....................................................................................................................... 76 1.4 SOCIAL DEVELOPMENT PERFORMANCE ............................................................. 76 SOCIAL WELFARE ...................................................................................................... 78 WOMEN AFFAIRS ....................................................................................................... 79 Box 4: Progress on Gender Mainstreaming ....................................................... 79 EDUCATION ................................................................................................................ 80 HEALTH ...................................................................................................................... 83 Box 5: SEDP-I Health Targets .............................................................................. 83 1.5 LESSONS LEARNED ............................................................................................ 87 ANNEX 2: POPULATION AND POVERTY .............................................................. 89 2.1 POPULATION ...................................................................................................... 89 2.1.1 HIGH POPULATION GROWTH RATE .............................................................. 89 2.1.2 HIGH FERTILITY AND MORTALITY RATES ..................................................... 90 2.1.3 HIGH MIGRATION..........................................................................................