W1: Cambodia - Overview

  • Population: 15703820
  • Government Type: Constitutional Monarchy The Royal Cambodian Government (RCG), a constitutional monarchy formed on the basis of elections internationally recognized as free and fair, was established on 24 September 1993.
  • Ethnic groups: Cambodian 90%; Chinese and Vietnamese 5% each; Burmese, small numbers of hill tribes like Chams and Khmer Loeu.
  • Exports partners: USA 23.1%, UK 8.8%, Germany 8.2%, Japan 7.4%, Canada 6.7%, China 5.1%, Vietnam 5%, Thailand 4.9%, Netherlands 4.1% (2015)
  • Exports - commodities: clothing, timber, rubber, rice, fish, tobacco, footwear
  • Imports partners: Thailand 28.7%, China 22.2%, Vietnam 16.4%, Hong Kong 6.1%, Singapore 5.7% (2015)
  • Imports - commodities: petroleum products, fabrics, vehicles, wholesale yarn, cigarettes, electrical communications equipment and medicine.

W2: Levels of Development

Diversity in Less Developed Countries (LDCs)

  • Cambodia - Khmer Rouge, Civil war, Vietnamese Cambodian war made it difficult for Cambodia
  • Liberia - Civil war, military coup
  • Myanmar - political issue
  • Many of the LDCs are LD due to the post war affect, not being able to pull itself back up in terms of economical activity
  • focus on GDP/capita-economic activity can be measured

LDC Negative income abroad causing the GNI to be lower than their GDP

Health and Education meausres

  • Infant mortality rate: is the number of deaths under one year of age occurring among the live births in a given geographical area during a given year, per 1,000 live births occurring among the population of the given geographical area during the same year.
  • Life expectancy-average period that a person may expect to live
  • Under weight children
  • Literacy rate: Percentage/rate of population that is able to read and write
  • Average schooling years: The average number of years spent in education per person in the country
  • Primary school conpletion

Human Development Index

The Human Development Index (HDI) is a composite statistic of life expectancy, education, and per capita income indicators, which are used to ranJapan: Ranked 20, 0.891Japan: Ranked 20, 0.891k countries into four tiers of human development.

  • Cambodia: ranked 143, 0.555
  • Liberia: Ranked 177, 0.430
  • Myanmar: Ranked 148, 0.536

Human Development Index (HDI), Life expectancy at birth, Expected years of schooling, Mean years of schooling, Gross national income (GNI) per capita, GNI per capita rank minus HDI rank

  • Cambodia: 0.555 68.4 10.9 4.4y 2,949 7
  • Liberia: 0.430 60.9 9.5l 4.1e 805 7
  • Myanmar: 0.536 65.9 8.6 4.1e 4,608k -12

W3: Domestic Factors and Economic Development

  • Explain the status of the SDGs
  • Didcuss the domestic factors that aid economic development
  • discuss the relationship between economic growth and economic development
  • describe the poverty cycle
  • domestic strategies for foster economic growth

Poverty trap/cycle: low income and poverty→low savings→low investment in physical, human and natural capital → low productivity → low growth

The poverty trap is a mechanism which makes it very difficult for people to escape poverty. A poverty trap is created when an economic system requires a significant amount of various forms of capital in order to earn enough to escape poverty.

  • Domestic strategies to foster economic growth
  • health
  • education
  • empowering women
  • technology (where appropriate)
  • Access to credit or micro credit
  • income distribution

W4: International Trade + Economic development

There are a number of international factors that act as a barrier to both growth and development. Give examples of how the following may have impacted your country:

  • Over-specialization on a narrow range of products (do they have a diverse range of exports? if so, have they always had? Or is it narrow?)
  • Price volatility of primary products (include charts/explanation of impact of price volatility)
  • Inability to access international markets (which markets? How were they blocked? Or what lessens the trade and growth that would occur without barriers?)

Over-specialization on a narrow range of products

  • LDCs - Dependent on the production of primary goods
  • dependent on a limited number of good for its export revenue
  • a country can be badly affected by the changes in the relative price of imports and exports
  • If the world price of the main export falls the terms of trade deteriorate. As industries become more productive, world supply increases - pushing long-term prices down. Therefore the terms of trade of primary goods fall over tie. Fewer imports can be bought with the revenue earned from a given quantity of exports

Price volatility of primary products (include charts/explanation of impact of price volatility)

W5: Growth and development strategies aimed at increasing trade

With reference to your country, evaluate 2-3 of the following as a means of achieving economic growth and economic development.

  • Import substitution
  • Export promotion
  • Trade liberalizations
  • The role of the WTO
  • Bilateral trade agreements
  • regional preferential trade agreements
  • Diversification

Bilateral trade agreements/trade liberalizations: Cambodia been negotiating the TPP however, has signed only one trade agreement with Vietnam: Bilateral Trade Enhancement Agreement (BTEA). Cambodia signed a trade agreement with Vietnam on October 26, 2016. This Agreement, which was signed by H.E. Pan Sorasak, the Minister of Commerce of Cambodia, and H.E. Tran Tuan Anh, the Minister of Industry and Trade of Vietnam, and witnessed by the Prime Ministers of both countries, occurred during the 8th Cambodia-Laos-Myanmar-Vietnam Summit (CLMV-8) in Hanoi, Vietnam. According to this Agreement, Cambodia will take 0% tariff on 29 products imported from Vietnam, including milk and cream, starch, meat products, products made from rice, sweets, paint, plastics, paper, ceramics, steel, and steel products. Meanwhile, Vietnam will provide tariff-free on 39 products exported from Cambodia, including 300,000 tons of rice exported annually and 3,000 tons of dried tobacco leaf exported for 2016-2017. Soeng Sophary, spokesman of the Ministry of Commerce, told the Phnom Penh Post that the MoU would benefit producers and exporters in both countries and promote the flow of cross-border trade which is targeted for 5 billion US$ which was only 3 million US$ in 2015. “This bilateral MoU will provide direct benefits to producers and exporters because they will receive a tariff exemption and consumers will in turn get fair prices,” she was also quoted by the Phnom Penh Post saying, “It is part of a mutual strategy of promoting bilateral economic growth.”

TPP: The TPP claims to promote economic growth, support the creation and retention of jobs, enhance innovation productivity and competitiveness, raise living standards, reduce poverty in the signatories’ countries, and promote transparency, good governance and enhanced labor and environmental protections. This is to be accomplished by lowering both non-tariff and tariff barriers to trade and establishing a dispute settlement mechanism among the 12 countries. The TPP will cut 18,000 tariff among countries which totally represent 40% of global GDP and 1/3 of world trade. (

Diversification: Cambodia’s economy remains dangerously dependent on a narrow range of sectors, including rice-based agriculture, garments, tourism, and construction. Cambodia’s tourism sector was badly affected by a sizeable drop in visitor spending. In Cambodia, when the garment and tourism sectors suffer, many other areas are also put at risk, such as increased unemployment and reduced remittances to families. In addition, investment that does exist in Cambodia is highly concentrated in a few geographic areas: the capital city of Phnom Penh, the world-famous temple city of Siem Reap, the harbour town of Sihanoukville, and a few small areas along the borders of Thailand and Vietnam. - To ensure sectoral and geographical diversification, Cambodia needs to increase its competitiveness in the region, capture higher added-value, and acquire new know-how and technology. This implies important commitments not only in terms of infrastructure, human resources, natural resource management, investments, and financial services, but also for new structural reforms to improve Cambodia’s business environment. This would help boost the perception from national and international investors that Cambodia is competitive and reliable compared to its neighbouring countries. (

W6: Aid, Trade, FDI

Cambodia+Haiti ODA comparison: Over the last decade, Cambodia has received an average of US$600 million a year, of which 10% was provided by NGOs. The main sector destinations included government and administration, health, transportation, education, and rural development. Australia, a provider of approximately US$ 90 million a year in recent years, which has gone towards infrastructure development, agricultural promotion, health, and education. Other countries that assist Cambodia include Japan and the US (which provided $80 billion in 2014). On the other hand, Haiti's development situation may target different sectors especially after the devastating 2010 earthquake. ON average, Haiti receives around US$900 million a year, which is more than that of Cambodia. Haiti's largest donors are Canada and the United States, the Inter-american bank, and the European commission. This likely to be due to political advantages (due to proximity) to American countries by donating to Haiti which are similar to Asian and Australasian countries donating to Cambodia. Much of the aid was spent on social services, infrastructure, health, peace building, and government services; in contrast to Cambodia, the aid is structured such that it targets re-stabilising a destabilised government and rebuilding the population rather than providing general aid.

W7: Impact of Debt on Economic Development

market approach or the interventionist approach? - Interventionist approach would require great amount of money/resources for it to show effectiveness in the economy. However with the high existence of debt, LDCs would find it difficult to source the money/resources that they can use/budget for economic development. Market approach would allow anyone within the market to play role, have power. In order to build basics and have budget for development, market approach may be a better option. Additionally, some LDCs are caused due to poor governmental control/political issues. The interventionist approach would require


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