Programme description

Title: Programme for the Promotion of the Private Sector in Rural Areas
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)
Country: Cambodia
Lead executing agency: Ministry of Industry, Mines and Energy (MIME)
Overall term: January 2005 to December 2010

Context

Cambodia’s social and economic development is severely burdened by the collective trauma of nearly 30 years of war and war-like conditions, in which the social order and the economic basis of the country were largely destroyed. Since 1993, the economic situation has increasingly stabilised. The baseline for this growth, however, is very low and rests nearly exclusively on tourism as well as on the textile and construction industries.

The greatest barriers for foreign and domestic investors alike include an underdeveloped legal system, a civil service which offers a very narrow spectrum of services and which still bears signs of systemic corruption, an inadequate infrastructure and a limited domestic market. A central problem is the extreme poverty in rural areas.

Objective

The employment and income situation of micro, small and medium-sized enterprises (MSME) in selected rural regions is sustainably improved. Greater participation in the economy enables the rural population to improve their livelihoods and quality of life by their own efforts and for the long term.

Approach

Acting on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ), GTZ has promoted the Cambodian private sector since 2005. In rural regions, three components are implemented:

• Services for the private sector in rural areas
• Initiatives for local economic promotion
• Transfer to the policy level

Results achieved so far

The Phnom Penh Small and Medium Industry Association (PSMIA), supported by the programme, organised several market-oriented trade fairs in the capital, Phnom Penh. This created a regular platform for products made in Cambodia.

Through regional promotion, especially in value-added chains with a high percentage of women, initial improvements have been achieved in the rural employment and earnings situation.

The distribution of 800 commercial mobile telephone cells in rural areas created numerous jobs and new livelihoods for women.