Is the wealth gap growing in Cambodia?

Flagging a problem. Is the wealth gap growing in Cambodia?

Flagging a problem. Is the wealth gap growing in Cambodia?

I must admit a personal distaste for “get rich” seminars that seem well designed to excite people into parting with their hard earned cash. There may be merit in the teaching of Mr Rich Dad Poor Dad Robert Kiyosaki, but there was something obscene about the advertising for his course being run in Phnom Penh this year. Kiyosaki wasn’t presenting in person – the seminar would be taken by a multimillionaire who got that way by adopting the methods that had been taught since the Rich Dad Poor Dad franchise began in 1992. The banner is what put me off: How the rich get richer!

This is a problem for Cambodia, because in the years since 1979 while the economy has grown for this little nation, basically starting at ground zero, there is still a significant problem of poverty. A visitor spending a day or two in Siem Reap might not notice; after all the hubbub of traffic and commerce is headache inducing. Or go to the Phnom Penh, and the skyline is dotted with cranes, and new buildings are changing the skyline. The question is, with growing GDP, where is the wealth heading? Is it trickling down? Or trickling up?

First let’s look at the productivity per person in Cambodia. Measured in the international currency of US dollars this has grown. Figures from the International monetary fund – the IMF.

  • 2009 when it was $1,942.74
  • 2010 when it was $2,068.02
  • 2011 when it was $2,239.24
  • 2012 when it was $2,402.33
  • 2013 when it was $2,579.06

That’s a 33% growth in just four years, enough to nudge Cambodia from From being the 38th poorest nation in the world measured in these GDP terms in 2008, to become the 43th poorest nation in the world by 2013.

The income distribution is far from equitable in Cambodia. World Bank figures suggest that the wealthiest 10% in Cambodia earned approximately 30% of the total income – a figure that has slipped slightly between 2004 and 2007.

Meanwhile the bottom 10% of income earners earn around 3% of the total national income. This figure has hardly moved between 2004 and 2009. Put another way, using UN estimates, in 2004 Cambodia’s richest 10% earned 12.2 times more income than Cambodia’s poorest 10%.

This ratio of 12.2 is comparable to many other countries – 12.5 in Australia example, or 15.9 in the USA (estimate in 2007) where the CEOs of large firms seem to routinely earn multimillion dollar salary packages.

But there are some signs that the situation is getting worse in Cambodia. This is due to several factors including:

  • Poor health conditions.
  • Malnutrition.
  • Financial barriers to advanced education.
  • Environmental vulnerability – floods, storms or droughts can cripple farmers incomes. I have noted elsewhere in this blog that Cambodia has been independently rated amongst the world’s most ecologically vulnerable nations on this planet.
  • The commodity nature of rice farming in Cambodia – where farmers are priced takers, and do not have premium product with which to make greater margins.
  • The taking of farmers land by large corporations.
  • Extensive ownership of capital by foreign controlled entities.
  • Corruption at all levels.

This overall situation creates an air of hopelessness for the rural poor. How can they ever succeed if they cannot send their children to school, if they cannot afford your equipment, or if they lose their land.

I was pondering how this hopelessness begins at a very early age, especially amongst children and families so poor that starvation or malnutrition is a serious problem.

Two Hong Kong academics wrote a report in  2009 concerned with early childhood education. They were examining the weak infrastructure around pre-schooling – noting that while the Ministry of education youth and sport (MOEYS) is committed to the idea of preschool, to help give young Cambodian infants head start educationally, in practice there is scarce public funding for such a strategy. This has been left up to the communities to provide. A case I suspect, whether rich get richer, and the poor don’t even get a start at all.

Here’s what they said in their report:

Exclusion on the grounds of poverty.

No one is more likely than a child to live in poverty in Cambodia
(UNICEF & RGOC, 2006). The representation of the poor is much greater in the primary than in the secondary or tertiary student population. In Cambodia 20% of primary students but only 2% of upper secondary students are drawn from the poorest 20% of the population. In contrast, 61% of the upper secondary students come from the richest 20% of the population. The representation of the poor in tertiary education is zero whilst the richest 20% account for 57% of tertiary level students.

As has already been discussed, poor children are currently rarely found in preschool provision and the MoEYS has identified them as a target group on which to spend its limited resources for ECCE in order to ensure equity of opportunity. It acknowledges that this is likely to be challenging as the poorest communities lack good models, infrastructure and experienced providers.

Preschool and Preparation for Primary School

It is widely accepted that preschool experiences, by preparing the child academically and socially for school, lowers repetition and drop-out rates. The benefit is felt most by children in the poorest communities. Yet in Cambodia, children with the greatest need of the chance to learn in groups, mix with others, acquire pre-academic and language skills before they begin primary school are the ones that have the least access. Thus ECCE is not only intrinsically important but is needed to provide experiences and preparation that gives a child a much better chance of succeeding in school and completing at least six years of primary school. ECCE is a vital component of a successful Education for All strategy.

Although the initial enrolment in primary school has improved significantly, the drop-out rate remains stubbornly high and one of the main reasons is poverty. Families are often unable to pay the cost of schooling that can amount to 79% of per capita nonfood expenditure of the poorest 20% of families.

Another significant concern regarding children in Cambodia is that at the formal age of enrolment into primary school, many are too immature in their physical, social, linguistic and cognitive development. This is reflected in delayed enrolment and high repetition rates in Grade 1 leading to high dropout rates (RGOC, 2003). They are simply not ready for school as a result of malnutrition and lack of preschool experiences. Only 58% of Grade 1 students are six years old, the prescribed school entry age.

Only 45% of children in Cambodia who start primary school will complete Grade 6, and only 38% will enter lower secondary school. It takes an average of 10.8 years for a child to complete the six-year primary school cycle (UNICEF & RGOC, 2006).

Early Childhood Care and Education in Cambodia by Nirmala Rao Veronica Pearson, The University of Hong Kong

(International Journal of Child Care and Education Policy Copyright 2009 by Korea Institute of Child Care and Education
2009, Vol. 3, No. 1, 13-26) For A PDF of the report CLICK HERE

I accept that many of the figures I have highlighted for emphasis have improved somewhat, since these figures were first collected, but they highlight why free education is so valuable for poor rural areas.

Imagine that – just 2% of those who make it to grade 12 at high school, come from the poorest 20%.

Last week Savong sent me the list of students from his school who have progressed through to  winning University scholarships – a program we instigated four years ago. The first two graduates have already come through, and their two cohorts have both taken up teaching jobs, just a few papers away from completing their degrees.

Meanwhile more recent scholarship winners are attending Angkor University, and studying computer science, tourism (which has a strong management component) as well as English. these students have a lot of pressure on them in some ways. They know their families will depend upon them, and they know there are up against much more privileged students from the city.  When Rao and Pearson wrote their report, at that stage less than half a percent –  statistically 0%- of tertiary students in Cambodia came from the poorest 20%. And at that stage less than 10% of teenagers were progressing through to University education. so if you allow me to roughly play with figures, that makes the chances of producing graduates from Bakong something like 1000:1.

Those are the kinds of odds that families are up against in poor rural areas within Cambodia. Those are the odds that Savong and his supporters, and his staff, are working hard to beat.

For more: Let’s not forget the costs of poverty – and the pressure it puts on young people

MY FUNDRAISING CRISIS

Money isn't everything, but it sure helps. Savong's School - like every school world-wide, needs funds.

Money isn’t everything, but it sure helps. The school – like every school world-wide, needs funds.

Last week I reignited this blog after five months silence. A few of you will know that this year I had a health surprise, namely a diagnosis of Parkinsons disease.  So far the disease has not produced radical symptoms –  extreme shakes,  or, an affliction that strikes many sufferers, ( at least eventually,)  immobility. It is not uncommon for those with Parkinsons to freeze  when they get to a door,  and require some visual prompt to get them started again. I’d say I’m  bound to be on an interesting adventure to say the least.  But for now my symptoms include:

  • Loss of the use of my right hand when it comes to typing. My right arm is about as useful as a plank of wood.
  • The need for much more sleep!
  • A slowdown in my work rate –  my brain is sharp,  but it takes longer to get my thoughts down on paper.

During my  five months silence  I enjoyed a long overdue holiday with my partner, Susanna, and I spent quiet time ruminating about the impact of my condition.  It has scrapped the old rules, but the problem is there are no new hard guidelines.  Everybody with Parkinsons  experiences a different combination of symptoms,  and the onslaught of these occurs at different speeds. Who knows? So against this shifty backdrop I have been trying to contemplate what the impact will be on my life.  I’m starting to set goals  and objectives: of bucket list of things I want to achieve before – and just in case – I deteriorate beyond usefulness.

Some of these goals are very tangible.  I wish to complete a long cycle ride within the next 24 months,  and there are some writing projects that I have started already: things I have long wanted to write.

But there is one central crisis I have not been able to resolve,  and that is the funding  of Savong’s school in Cambodia. Savong’s project  has many branches –  two homes for children,  a student centre for older students in Siem Reap, as well is the school  in Bakong which serves primary school children as well is secondary.  It also provides scholarships to University  for the top grade 12 students each year.  These scholarships are worth about $1000 per student per annum  over the four years required to get a degree.

All up,  the school  requires at least $3000 per month to run, and a majority of this money has come out of my own earnings.  Over the past 10 years it has been more efficient for me to knuckle down to work, to earn my income as a researcher,  and to send the money over to Cambodia. Far easier than fund raising.

This last year I was going to make the transition  toward fundraising however.  I am almost 60, retirement is around the corner,  and I need to find an alternative  source of income to underwrite the ongoing expenses  of Savong’s school. I saw this as a kind of baton change in a relay race.  What the Parkinsons diagnosis did was cause me to stumble badly and drop the baton.

So now by my reckoning  I have got eight months  to get my fundraising act together.  Somehow,  somewhere,  through some people,  I need to find sponsors  to the tune of US$3000 per month. The school in Cambodia,  which serves many hundreds of children,  faces many challenges of its own:  my health shouldn’t be one of them.

See also: About the school.

And how to donate the school.

Malnutrition still a problem in Cambodia

Rice production is rising in Cambodia - but as agriculture develops there is still a serious malnutrition problem.

Rice production is rising in Cambodia – but as agriculture develops there is still a serious malnutrition problem.

For anyone who visits Cambodia regularly  there is a palpable sense, upon each visit,  that this troubled little nation is making rapid strides economically.  In 2004 I remember my motorcycle driver in Phnom Penh  taking me to see the most dazzling symbol of the modern age: Cambodia’s first escalator. He had never actually set foot on it before, and it was a pleasure watching him take his first ride.  At the time as a Westerner, I felt very much like a visitor from another and very privilegedplanet.

Today the sky line-up Phnom Penh is sprouting high-rise buildings at a rapid rate, smart phone usage across the nation is soaring, roads are becoming congested with cars and at first glance it appears that the days of poverty are basically over. This poses a question for any supporters of NGOs in Cambodia: at what point do we say, the job is done –  mission accomplished?

Well, don’t pop the Champagne just yet. According to some recent figures published this year, and funded by the Independent European based organisation;  Global Governance for Hunger Reduction Program productivity by Cambodia’s agricultural sector has soared, at least in US dollar terms,  since 2007 –  basically doubling in that time from US$3.5 billion  to US$7.9 billion in 2011.  Now those figures include the tremendous price spike in commodity prices that occurred in 2008 –  but even so,  if we measure cereal yields (rice, maize etc)  we see yields growing  by 16%  in terms of tonnes per hectare over the same time. (The real revenue is being generated by rubber, palm oil and sugar,)

The government  has a medium to long-term strategy of increasing the value and quality of agricultural output so that the rice, for example, meets the stringent quality standards demanded by Western markets who in turn will pay premium prices. Cambodia will be sharing this story at the Milan Expo 2015.

But the same source of facts and figures has a few warning signals.  Right now Cambodian farmers,  who make up 65% of the total national workforce, are focused on low value add commodities – namely rice – whereas Cambodia’s main commodity imports,  measured in dollars,  a spearheaded by the importation of, get this: cigarettes.  Economists often  illustrate their science by giving examples of guns and butter,  but in this modern example Cambodia appears to be trading cheap rice for expensive cancer.

That’s my judgement anyway,  but the figures also highlight the degree of malnutrition that is occurring even today in booming Cambodia.

Since 2007  the poverty rate in Cambodia has halved,  but it still sits at 20% of the entire population below the line of  $30 per month. The poverty gap is widening. The wealth is trickling upwards quicker than downwards.

One measure of malnutrition is the incidence of underweight children under five years old. In 2007 when the poverty rate was closer to 40%, some 28.8% of children were reported as underweight. Two years later the figure was virtually unchanged.

According to the authors of the report the number of Cambodians undernourished in 2009  was 2.9 million. Today the figure is improving –  but the figure is still over 2 million people.

Finally, they report the improvement between 2007 and 2011  of the percentage of Cambodians who have access to clean water sources. Again, this is improving, but has a long way to go. In 2007 some 59% had access to clean water. Four years later  the figure had improved to 67%. Still, that leaves close to 5,000,000 Cambodians without access to improved water sources today.

The economy may be booming, but with 80% of Cambodians living in rural circumstances, there is a sense in the data that many are toiling  hard, but getting no further ahead.

Is this Cambodia’s most precious resource?

From the air we see these rice paddies as watery fields.

From the air we see these rice paddies as watery fields. But the rice economy relies in equal measure on another resource.

Every day hundreds of dump trucks, open topped Chinese vehicles that look they were inspired by Mongolian fortress design, ply the roads of Cambodia, delivering their mountains of cargo. It suddenly struck me, one afternoon, that this is the stuff that the Cambodian economy rests on. Not coal. Not iron ore. Not bauxite.  But sand.

Sand makes the difference in a land of which 75% lies within one meter of the water level: of being just one typhoon away from being submerged or emergent.

When you buy a property in Cambodia the first thing you do is put up a wall, and then build up your property with truckloads of sand.  This will prevent flooding. It will allow your trees to grow. Water won’t pond after a heavy storm, and mosquitoes won’t breed.

Sand builds the walkways that rice farmers use to navigate their paddy fields. Many of these walkways are hundreds of years old, and the work of predecessors who knew the power of irrigation, but also the efficiency of roadways wide enough to carry the harvest.

Sand forms the understructure of the Number 6 Highway that forms the economic spinal column of Cambodia – a two lane blacktop road that, given the floodplains it travels over, is a greater engineering marvel than most of us realise. How much of this goes back to raised sandbanks built a thousand years ago during the Angkor years? There are clues along the roadway, for example the ancient bridges near Dam Daek 30 kms East of Siem Reap.

Sand. Unstable sand. Many of us were raised on the parable of the wise man who built his home on rock, and the fool who built his house on sand. Yet here is a whole Kingdom, resting on the stuff and – so far – proving pretty wise about it. Those trucks keep moving it around, one step ahead of the next typhoon.

Culture plays a big role in the way NGOs are run

Image

The thoughtful 2009 book, Roads to Development, is one I found – very gratefully – at Siem Reap airport’s excellent little bookshop before I flew out. I’m always thirsty for insight regarding modern Cambodia and how westerners like me need to interact; so I found this book based on 70 interviews with a wide variety of community and NGO stakeholders in the Southern district of Sre Ambel to be particularly informative.

The text was researched and written by two people; Meas Nee who is a Cambodian who studied for his Doctorate at LaTrobe University in Australia, and Wayne McCallum who is a New Zealander – also a PhD – who has worked in Cambodia since 2003. They studied the various pathways for development of Sre Ambel district, and reflect on how different philosophic approaches succeed or fail in the Cambodian context. The book is instructive, and helps make sense of the messy gumbo of “development.” In this context I worry about the big Chinese investments that effectively serve big business, but disenfranchise locals from their own land. The numerous land rights issues in Cambodia are an ugly facet of the nation’s “development.”

I found one particular chapter by Meas Nee particularly eye-opening. He describes how Khmer people see development through a particular local lens. Characteristics of this view include:

  • The notion of the “patron leader” in each community. Rather than a “voice of the people” approach, Cambodians often delegate issues upward to a patron who ‘will look after us.’
  • Problem-based rather than issue-based thinking. The tendency to see problems that need a band-aid, rather than an issue that requires an underlying change.
  • Activity focus rather than strategic focus. Hence what gets measured (number of injections) is often out of step with the real issue (is disease being reduced – is the real issue the poor water quality?)

Meas Nee suggests that one of the root causes of the latter two outlooks is the type of education in Cambodia’s schools: which do not stress critical thinking and problem solving. But for sure, his three sets of characteristics are often at the heart of misunderstandings between supporters of NGO’s (us folk in the west who require strategic focus, KPIs, accountability) and the local managers.

The book has given me a concise understanding of some of the frustrations I’ve sometimes felt in the past, and some of the frustrations Savong has felt with me. Culture: it often influences us in surprising ways.