Implementing a Pro-poor Trade Strategy for Cambodia High Level Regional Conference On Trade Related Capacity Development For Selected East Asian Countries 5 February 2008 Phnom Penh-Cambodia

Overview Trade Integration Strategy 2007; Trade Sector Wide Approach, from developing to implementing a Strategy; UNDP Trade Related Technical Assistance

Cambodia’s 2007 Trade Integration Strategy Cambodia IF experience In 2000, Cambodia was designated as one of three pilot countries under the Integrated Framework (IF). The first DTIS was fairly successful in terms of both outcomes and process. Institutional weakness and lack of appropriate structure

Cambodia’s 2007 Trade Integration Strategy Critical and Timely Takes stock of Cambodia’s successful integration into the world economy; Potential new products and markets; It recognizes the changing nature of competitiveness in international markets; Strengthen positive linkages between export development and poverty reduction

Cambodia’s 2007 Trade Integration Strategy Four Goals Identify potential priority products and services to strengthen and diversify Cambodia’s export base. Identify bottlenecks common or specific to those priority export sectors to be removed in order to promote their development; Link more clearly trade sector development to poverty-reduction and sustainable human development Serve as a basis to formulate trade sector development objectives to be implemented through a Trade SWAp

Cambodia’s 2007 Trade Integration Strategy Current Exported Products Beer Cashew Nuts Cassava Corn Fishery Footwear Garments Live Cattle Rice Rubber Silk Soybeans Services and Non-Exported Products Professional Services Transportation Services Computer Services Labour Services Light manufacturing Agricultural products Wood products

Cambodia’s 2007 Trade Integration Strategy Human Development Impact Export Potential LowMediumHigh Garment, Tourism Medium High Silk Fisheries, Rice, Fruits & Vegetables Medium Livestock Cashew nuts Wood products Light manufacturing Labor services Footwear Rubber Medium Low CornSoy beans Low Beer Web-based services Transport services Cassava

Cambodia’s 2007 Trade Integration Strategy Cross-Cutting Legal and Institutional Issues Trade Facilitation (Twelve Point Action Plan); Investment Facilitation (Strong Focus on SEZs and targeted investment promotion); TBTs (Law on Standards, access to internationally recognized conformity certification); SPS (strong focus on plant health and animal health –especially for fish); IPRs (trademark, patents, Geographical Indications); Work Program of RGC resulting from WTO Accession

Cambodia’s 2007 Trade Integration Strategy Sector Specific Issues Producers’ ability to meet SPS, technical standards, IPRs at product/service sector level. Ability of extension-service-type infrastructure to deliver service and train producers; Exporters’ ability to obtain market opportunity information and access international distribution channels. Ability of product/business associations to provide such support; Entrepreneurial and managerial capacity at product sector level; Access to skill labor, including through sector-specific training schemes; Access to investment and technology to increase processing capacity

Cambodia’s 2007 Trade Integration Strategy Sector Specific Issues Producers’ ability to meet SPS, technical standards, IPRs at product/service sector level. Ability of extension-service-type infrastructure to deliver service and train producers; Exporters’ ability to obtain market opportunity information and access international distribution channels. Ability of product/business associations to provide such support; Entrepreneurial and managerial capacity at product sector level; Access to skill labor, including through sector-specific training schemes; Access to investment and technology to increase processing capacity

The next immediate challenge for Cambodia is to capitalize on the key findings of our 2007 Trade Integration Strategy and turn them into a well-focused Action Program for trade development. The Trade Sector Wide Approach (SWAp) will be the critical instrument for Cambodia to meet this next challenge. Strong coordination among the Government, Cambodian trade stakeholders, and Development Partners will be key to ensuring the continued successful integration of Cambodia in the global economy. From DTIS to Trade SWAp

Trade SWAp? A mechanism to plan and coordinate human, institutional, and financial resources of the Cambodian Government, Cambodian stakeholders and Development Partners for the purpose of strengthening trade sector development; A mechanism based on a single and shared strategy (DTIS 2007) and a limited set of shared objectives (the three “pillars” of the Trade SWAp); A mechanism guided and monitored by the Sub-Steering Committee on Trade Development and Trade-Related Investment under MoC leadership

Reforms and Cross-Cutting issues Trade Facilitation, SPS, TBT, IPR, Investment promotion, legal reform... Product and Service Sector Projects Value Chain Analysis, Sectoral Strategies Capacity Building Expertise, negotiation, management... Cambodia Trade Integration Strategy (DTIS 2007) 3 Years Rolling Plan

Program Objectives: Identify, eliminate, and/ or lessen legal, institutional and human capacity bottlenecks; Identify and promote the development of a set of priority product and service sectors; Strengthen the capacity of the RGC, and MoC in particular, to manage Cambodia’s trade development agenda; Gear trade sector development efforts towards increasing their positive contribution to human development and poverty reduction (“mainstreaming”) From DTIS to Trade SWAp

Process: from a Diagnostic to a Strategy formulation towards its Implementation For each Pillar: a “shepherd” and a Government Focal Point will identify the main Pillar’s objectives, targets and indicators; Individual MoC departments and selected departments from other key ministries (for example, MIME, MAFF, others) will identify 1- year and three-year work plans to support achievement of each main sub-objective Work plans will be costed; existing resources and gaps will be identified; Three-year costed work plans will be consolidated into a Trade SWAp three-year rolling plan (MTEF); New resources will be mobilized; From DTIS to Trade SWAp

“Pillar 3”: Human and Institutional Capacity Development- Possible Themes Support to skill development among exporters (to be done in conjunction with sector work under pillar 2); Strengthening of the Government’s capacity to formulate its trade development agenda through development of a research and planning capacity in MoC and trade-related Institutions associated with Trade SWAp; Strengthening of the Government’s capacity to implement its trade development agenda through upgrading of skills in MoC and trade- related Institutions associated with Trade SWAp; Strengthening of the Government’s capacity to manage its trade development agenda through capacity building in areas of project cycle management in MoC and trade-related Institutions associated with Trade SWAp From DTIS to Trade SWAp

UNDP Strategic Plan “Pursue a capacity development agenda across the 4 focus areas to propel and sustain national changes in human development as the single most important UNDP service to programme countries”. Trade Related Capacity Development

Trade Related Assistance for Development and Equity (TRADE) The TRADE Project is owned and implemented by the Ministry of Commerce with UNDP’s support Project background: The Integrated Framework (IF) for Trade Related Technical Assistance (TRTA); Project Vision: Make Trade work for the Poor; Overarching Goal: Support the development and implementation of pro-poor trade strategy; UNDP's assistance to MoC is focused on developing national capacity for developing, implementing and monitoring trade integration strategy; Timeframe:

Trade Related Assistance for Development and Equity (TRADE) Pro-poor Trade Policies Formulation and Implementation Capacity Development for Trade and Investment Production and Export Development Forge Partnerships for Inclusive Market

Trade Related Assistance for Development and Equity (TRADE) National Capacity for Trade and Investment Enhanced Institutional development capacity Trade and Investment negotiation Technical expertise for Trade and Investment Program Management skills

Institutional development capacity-Programme Management : ▫Key departments for immediate in-depth capacity assessment and development; ▫Target group for capacity development in “project management” and “management-by-objectives” skills; Trade and Investment negotiation ▫Negotiation, FTAs as well as Investment treaties and contract Technical expertise for Trade and Investment ▫Trade related expertise, SPS, Standard, IPR, Legal Reforms Trade Related Assistance for Development and Equity (TRADE)

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