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Agribusiness
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Strengths
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Basic agrarian economy: Cambodia has always been, and will long
remain, a basic agrarian economy where in the great majority of the population
is engaged in agriculture, fishing or forestry occupations.
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Low population density: With 181,000 square kilometers and only 11
million people, Cambodia has a very low population density (61 person per square
kilometer compared with Vietnam at 242 persons, 4 times as much), so that there
is little competition between habitation and agricultural exploitation.
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Resource-rich environment: Soil quality has not been subject to
natural or human degeneration, and there are significant areas of virgin land
never cultivated. |
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Natural irrigation: Cambodia, historically, has one of the best
natural irrigation systems in the world, based on the Mekong and the Tonle Sap,
with annual flooding. Like the Nile, this helped to produce a high civilization,
but this irrigation system has since deteriorated, but can be restored.
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Rich fishery resources: Cambodia has wealth, both of freshwater
and sea fish, but harvests mainly freshwater fish, since equipment is lacking
for sea fishery. |
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Timber resources: Although subject to extensive in recent times,
now hopefully halted, Cambodia is still rich in forest resources, which need
careful management in future. |
Weaknesses
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Lack of exploitative infrastructure: Cambodia lacks storage
transport handling, distribution and export processing facilities, as well as
seeds, facilities and pest control. |
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Absence of market data: There is no data no the agricultural
sector as whole, while Cambodia traders have no access to nay network of
agricultural production trading or overseas market information.
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No domestic market system: Poor road infrastructure and absence of any effective
marketing system mean that small farmers have no ability to trade products
profitably. Individual farms are small, and there are no means to package or
preserve products for sale.
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Opportunities |
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Organic and natural food production: Fertilizer and pesticide
usage has been minimal in Cambodia. and this could encourage production capacity
of high quality natural products for sophisticated markets in Asia.
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Value-added emphasis: Cambodia agriculture contributes little to
GDP at present because there is very little value-added beyond the basic
commodities. This offers a lot of opportunity for opportunity for effective
linkages between growers and marketers.
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Supply chain management: Given the absence the absence of any
linkages between producer, marketing and consumer, there are good opportunities
for creation of supply chains, which can extend across borders to reach markets
of Vietnam, Thailand, Malaysia and Singapore.
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New product development: There has never been any experimentation
in product introduction, apart
from the rubber plantations, which are an extension of those beyond the borders
in Vietnam. There is good potential for new product development.
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Sustainable commercial forest plantation: Illegal timber felling
and forest depredation has drawn attention away from legitimate forest
exploitation. Sustainable forestry might merit additional investment privileges,
in view of additional investment costs and delayed return on investment.
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Commercial sea fisheries: Cambodia has a seacoast and territorial
waters but virtually no commercial fishing fleet. Resources are systematically
plundered by Thai vessels. There are prospects for development in this sector.
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Challenges
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Land ownership and transfers: There are considerable uncertainties
regarding land ownership and land use right making commercial agriculture
difficult to undertake. |
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Financing: As with most less-developed countries, it is difficult
for the agricultural sector to obtain finance,
and when finance is available, it is expensive, currently 4% per month.
Even at this rate, 98% of farmers manage to repay, but interest costs eliminate
most of their profit.
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Short and long term policies: Throughout the agricultural, fishery
and forestry sector, there is an inevitable tendency to emphasize the short-term
rather than the long term. Short term usually means destruction of basic
resources, but is more profitable while it lasts.
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Expectation
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Prioritization of agriculture: Since the majority of Cambodia
derive their livelihood from the primary sector, and Cambodia is now under a
democratic system, there is an expectation that greater attention will be given
to this sector than in the past, as voting power is in the countryside.
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Commitment to innovation: Agricultural research and development
can seldom be left to private sector initiatives, since the benefits are usually
made generally available to the agricultural community. It is necessary that the
government should take the initiative, aided by international organization.
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Agricultural export privileges: Cambodia already enjoys
generalized system of preference privileges with many development countries,
including agricultural products. These need to be developed and utilized to the
full.
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Concerns
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Agriculture at the end of the queue: Although agriculture has such
evidently high priority in view of the proportion of population involved, it
does not have the immediate appeal that more advanced sectors may secure, This
may result in continued neglect.
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Interest groups: Despite the clear national interest involved in
developing sustainable agriculture, and improving the situation of farmers,
there are many interest groups, which take a short term view and many stand in
the way of beneficial policies.
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Inadequacy of legal infrastructure: Multinational groups will need
a particularly secure legal situation if they are to become involved in
agro-industrial projects. At present, such assurances are not available in
Cambodia.
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Action
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Creation of effective implementation: There is a strong need for
an effective Cambodian Farmers Organization to improve technology transfers,
assist with seeds and supplies, and facilitate cooperative marketing and export.
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Information network: To bring buyers and sellers together, it
would be beneficial to have a detailed internet website listing of Cambodian
agribusiness and food product exporters. |
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Agricultural credit: The agricultural sector needs better and
cheaper access to finance, compared to what is currently available. |
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Legal reform: For agriculture investment, as for other purposes,
more effective land title arrangements and transfer procedures are needed. |
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Export processing zone facilities: Better provision is needed for
the processing and storage of agricultural products for export. This needs to be
taken into account in design of port facilities and industrial or export
processing zones.
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Multilateral agency cooperation: Major multilateral agencies have
shown their influence by withholding funding support, conditional upon
suspension of illegal logging. They could now turn attention towards routine
support for agro-industry development.
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