In the bustling capital of Phnom Penh, the skyline is constantly evolving as new buildings seemingly spring up overnight and local and foreign investment drive development. Outside the heart of the city, throngs of labourers pour into factories each morning and rice fields connect the nation to an agricultural history that can be traced back to the Angkor empire. 

Dr. Delux Teng, director of Centre for Development Economics and Trade (CDET). Photo: Southeast Asia Globe

As Cambodia transitioned to a lower-middle income country in 2015, it cemented its position as a stable base for agriculture, manufacturing and tourism, with an explosion of construction development in the last decade pushing growth. However, the ongoing development of a national economy requires keen analysis of the challenges facing the public and private sectors within the broader conditions of global and regional markets.

“For the last thirty years we have conducted research in economics and development in the Cambodian context,” explained Dr. Delux Teng, director of  Cambodia Development Resource Institute (CDRI)’s Centre for Development Economics and Trade (CDET). “A lot of our findings have been used by policy makers to direct and inform their decisions.”

While new airports and luxury condos are exciting signs of prosperity, the Cambodian economy is driven in large part by much smaller operations. With small and medium sized-enterprises (SME) accounting for 70% of employment, 98.8% of companies and 58% of GDP, it’s no surprise that CDET has turned its attention to this dynamic sector. 

In the 2013 working paper, Impact of the Global Financial Crisis on Employment in SMEs in Cambodia, researchers examined the impacts of the 2008 economic crash on small and medium enterprises, focusing on those operating in tourism and construction. Citing difficulty accessing capital and a limited social safety net, SMEs — especially female-led operations — were found to be particularly vulnerable in times of economic downturn. The report suggested that boosting marketing activities and pushing the adoption of digital technologies could increase resilience during crises. 

However, it’s not only the tourism and construction industries that are dominated by small operations in the Kingdom. 

With the average size of a Cambodian farm totalling  less than 1.5 hectares and with more than 75% of the country’s population living outside of cities, the role of small-scale crop cultivation in rural livelihoods can’t be overestimated.

“Agriculture is a mainstay sector that provides jobs, incomes and also provides food to rural households,” explained CDET Research Associate Narith Rouen. “This sector contributes a lot to Cambodia’s economy.” 

However, rural poverty remains a major obstacle in Cambodia. The importance of addressing the challenges facing rural Cambodians is essential for the welfare of the country and the first step in ending rural poverty is understanding it.

Starting in 1996, every three years CDRI has collected household information across the countryside, building a robust data pool for further analysis of trends in rural poverty. The 2020 Round of Panel Data Collection for Agriculture, Rural Development and Poverty Reduction saw the total number of households surveyed exceed 1,100 in 11 villages representing the country’s four geological areas: the Mekong Plain, Tonle Sap, Mountainous and Coastal zones. Supplementing government census data, the goal of the latest round of research was to provide lawmakers with the information necessary to create policies that can promote prosperity in these vulnerable communities.

“Agriculture is still the main employment for Cambodians in rural areas, and without effective intervention these issues [poverty] will still be there,” Rouen said. “So we want to map changes along the way, to follow the progress, look at how agriculture contributes to the development of Cambodia and identify optimum recommendations for the sector.”

Cambodian farmers harvest water mimosa, a popular vegetable dish, at a farm in Phnom Penh. Photo: Tang Chhin Sothy/AFP

The world is getting smaller every year, as value chains cross borders and the logistics of local economies become increasingly entangled with stakeholders beyond national boundaries. The Covid-19 pandemic is perhaps the most dramatic demonstration of the challenges facing our globalised world to date and has become a focal point for CDRI’s work  over the last two years.

But the pandemic also demonstrated the need for the type of comprehensive and cross-cutting research for which the organisation has become known. Looking at the pandemic from a holistic perspective, CDET’s The Impact of Covid-19 on Inclusive Development and Governance: Rapid and Post-pandemic Assessment in the CLMV examines socio-economic effects of the last two years on women as well as focusing on female-operated micro, small and medium-sized enterprises (MSME). 

Drawing on all of CDRI’s significant resources, the comprehensive nature of the research is impressive. Macro-economic influences, such as Covid-19’s impacts on cross-border trade are examined, as well as investigations into the ways that the pandemic has affected women’s labour mobility and unpaid care work. Beyond the private sector, the research also examines the existing policy landscape, how the government responded to the pandemic and implications for democratic governance in the region. 

CDET Research team. Photo: Southeast Asia Globe

However, the methodology of the research is also significant. Gender-disaggregated measurements and indicators were applied to the process as a means to better understand Covid-19’s impacts on women and provide gender-sensitive policy recommendations to authorities. Teams were also organised so that the data collection process mirrored the broader goals of the research: at least 50% all teams were female and gender advisors assisted at every level of organisation. 

With the research set to be completed near the end of 2023, the rigorous approach and comprehensive vision typifies CDRI’s commitment to staying on the leading edge of research science in Cambodia. 

“In the research field there is always something new and emerging, as is the case with Covid-19,”  Dr. Teng explained. “We conduct different lines of research, such as examining new ways to do business and new ways of diversifying our different sectors of the economy. For our centre, our research is always focused on new areas of change.”

This article is a part of a paid partnership with Cambodia Development Resource Institute celebrating their 30 Year Anniversary and highlighting their work over the past three decades . Follow CDRI and stay up to date with their projects on their Facebook page. Learn more about the partnership here.

Read more articles