Phnom Penh, 10 July 2018– The Royal Government of Cambodia (RGC) aims to position Cambodia as a home for cassava processing industries and a reliable supplier of cassava-based products for global markets. In addition to the export of cassava starch to diverse markets, the RGC also promotes the use of cassava by-products and residues for animal feed and fertilizers as cheap inputs for Cambodian farmers.
To achieve this goal, the RGC defines three main strategic objectives:
- To transform from subsistence to commercial cassava production, where the profitability of farmers is enhanced to generate incomes in the context of price volatility, sustainable land use and climate-smart agriculture
- To support active processors and attract investment to produce value added cassava-based products to supply diverse markets
- To enhance trade competitiveness by turning from market access to market presence, improving trade facilitation and reducing trade-related costs.
A series of trade-related reforms are continuously implemented to remove unnecessary costs, maintain key advantages, improve trade facilitation and develop additional value to enhance sector competitiveness –turning market access into market presence. Moreover, the RGC adopts policy procedures to enhance the profitability of value chain actors, specifically farmers and processors, through raising individual productivity and connecting with related forward and backward sectors to optimize the efficiency of selected cassava value chains. Thus, the price of cassava-based products is consistent with international prices, creating an equilibrium –where quality requirements are met efficiently and value chain actors can make a profit.
“To encourage sector development at an efficient speed, the RGC, in cooperation with development partners, designs and implements projects that fulfil the gaps in private sector and farmers investments. The cooperation shall accommodate the model of ‘Producer Private Public Partnership’ to ensure strategic use of resources and these resources achieve common and individual goals”, expressed by H.E. Pan Sorasak, Minister of Commerce.
“The policy aims to transform cassava into a profitable crop for smallholder farmers and a source of industrial development for Cambodia. To begin the transformation process, commercialization of cassava production and agri-business development should be done simultaneously to enhance the competitiveness of cassava produced and processed within the country against existing substitute crops in other areas of the world. The competitiveness builds the profitability of value chain actors in the context of market power and price volatility”, shared Dr. Richard Marshall, Country Economist, UNDP in Cambodia.
The RGC sees the importance and necessity of developing the cassava sector, as it is an existing crop grown by many smallholder farmers and holds a strong potential in the global market. Competitive advantages are still available in farms and can be maintained. However, upgrading existing processors and attracting investments to build advanced and sustainable factories, addressing cassava production issues, and improving business-enabling environments could drive the overall sector development and competitiveness.
The effective implementation of the above policy measures will lead to the achievement of goals. This will certainly bring substantial economic gains for Cambodia, along with its transition from a “least-developed country” toward a “lower-middle-income country”.