Policy Recommendations

 

 

                                   

As noted in previous sections, Cambodia has only enjoyed political rest since 1993.  From 1975 to 1979, the Khmer Rouge and the Communist Party ruled the country.  Even though the ruling of the Communist Party only lasted four years, major economic damage was done to the country.  Citizens, who were employed in the city as managers, teachers, bankers, etc., were forced to engage in agriculture labor.  Private property was taken away from the citizens.  ("Cambodia Money - Globe Aware") Schools and factories were closed.  Even after the Khmer Rouge left; Cambodia continued to be ruled by other nations- such as a Vietnamese-sponsored government and a United Nations- sponsored government.  Finally, in 1993, Cambodia returned to monarchy rule and the Kingdom of Cambodia was reestablished.

Policy recommendations for Cambodia should focus on getting citizens back to the cities and into skilled labor jobs.  In 2005, The World Bank pledged 504 million dollars to Cambodia for education, infrastructure and advancement. (“Cambodia Economy Today”)  In 2006, the Asian Development Bank followed suit and pledged 804 million for technology assistance, business loans, and economic advancement.  I would recommend policy that earmarks some of that capital for building world-class schools to educate unskilled labor, specifically younger women.   As noted in previous sections, the labor force participation rate for women is exceedingly high in Cambodia (“Cambodia”).  Women are currently working in the garment-construction industry in Cambodia.   They should be offered monetary incentives to give up their unskilled jobs and seek education and employment in the city.  With over 50% of the population under the age of 22, and investment in education would pay off (“Cambodia”). 

For unskilled labor, policy recommendations for Cambodia should focus on raising the minimum wage.  As previously noted, the minimum wage of $50.00 per week for workers is due for review in 2010. (Cambodia Economy Today”)  The Minister of Cambodia and the Garment Manufacturers Association should set policy on a higher minimum wage.  With more money in their hands, workers can purchase goods and stimulate the economy.

Since 1987, foreign investment has focused on increasing rice production in Cambodia. (“Cambodia Economy After Khmer Rouge”)  During the Khmer Rouge rule the land was taken away, and Cambodia could not produce even enough rice for its people. (“Cambodia”)  Today, almost all of Cambodia’s agriculture is devoted solely to rice.  Policy needs to be put in place to encourage other types of agriculture.  Taking into account the monsoon weather patterns of Cambodia, other crops need to be planted.  The benefits of planting different types of crops, like corn in addition to the rice, are that farmers can use their land for different growing seasons, and they minimize their risk when they grow more types of crops.  Policy should be set for monetary incentives for every acre of land that they devote to new types of agriculture. 

 

 

As noted in previous sections, for various political and economic reasons, Cambodian currency is very unstable.  Also noted was the current corruption behind the National Bank of Cambodia. (“Cambodia”) This bank used to be an independent bank, but is currently run by the Ministry of Institutes, with heavy influences from the former Khmer Rouge. (“Cambodia”).   In 2008, a consulting group (CG) was established to oversee the Ministry and begin making anti-corruption policy.  The world market still doubts the fairness of practices at the bank, since members of this CG have yet to enact anti-corruption policy. (Cambodia Economy Today”)   I believe that policy should be established whereby Cambodia relies on their membership in the World Bank and the International Monetary Fund to manage their banking system.  Cambodia cannot continue economic growth until their currency is stabilized.  

 

                                                           

 

                                                Works Cited

 

“Cambodia economy today.” Www.WTOcambodia, Web.

 

“Cambodia.” Wikipedia.com. Web.

 

Jergens, Nicholas. “Cambodia economy after the Khmer Rouge,” Time Magazine 6 Feb.  

 

2005. Print