PHNOM PENH, 01 November 2019 - Despite being the second largest agricultural crop in Cambodia, cassava’s huge potential for boosting the country’s economy and reducing poverty is under-realized. UNDP’s recent study Making the Case for Investment in Cassava, being launched on today, finds that the cassava sector could have substantial economic and socio-economic gains if it receives the right level of public commitment and investment.   

Cassava is both an important export commodity and an input to several industrial processes. Its development offers both output gains and structural benefits to Cambodia’s economy. In the light of its future role in promoting higher value-added and greater productivity, cassava has gained recognition from the Royal Government of Cambodia.

The study suggests that compared with other sectors, the returns to an investment programme of USD 294 million in the cassava sector would outpace livestock and food and tourism sectors. It delivers a similar result to investing in rice production.  In real terms the return is estimated to be around 3 to 1, and in nominal terms the national economy could enjoy a boost of over $940 million over ten years.

Speaking at the launch event of this report, Nick Beresford, UNDP Resident Representative, said that “a model used in the report launched today estimates that the socio-economic gains in terms of employment levels and poverty reduction are also significantly more favorable for investment in cassava. Distributional analysis shows that the investment is more inclusive, with the likely income gains favoring those with lower skills and landless rural households (compared with the other sectors).”

Cassava also delivers a relatively favorable boost to the government incomes. Tax revenues could rise by $130 million over a ten-year period of the investment in cassava. This is similar to the return to investment in the rice and livestock and food sectors, but the tourism sector does perform better on tax receipts.

Attending the event, H.E. Mao Thora, Secretary of State, Ministry of Commerce, shared his optimism that “cassava offers a means of maximizing inclusive growth, in line with the Royal Government’s long-term vision to become the world’s most reliable producer and supplier of cassava. It benefits Cambodia, particularly, through helping increase export and create more jobs for now and the future, thereby reducing risky migration, improving farmers’ living standard, and preventing them from falling into poverty.”

However, much of the cassava sector is focused on growing and exporting raw products, while in-country processing remains unexplored. Realization of these potentials requires public sector intervention including the provision of resources to support growing, processing and marketing; and implementation of supportive infrastructure projects. The investments to support the establishment of processing activities, such as infrastructure improvements, rank as the highest priority.

“Recognizing these potential roles of cassava, the Cassava Working Group clearly understands that the sector requires the equal support and commitment from the Royal Government of Cambodia to the rice production in prioritizing the cassava sector as the strategic sector too,” said H.E. Mao Thora.

Ends

For more information and media interview, please contact Samruol IM, Communications Analyst from UNDP Cambodia.

Full Report:       www.kh.undp.org/content/cambodia/en/home/library/2019/making-the-case-for-investing-in-cassava-november.html

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