Cambodia’s Average Yearly Income Hits $830

Cambodians are getting a tiny bit richer, or so it would seem.

According to figures released by the government this week, the average yearly income in Cambo­dia last year rose to $830, an 8.5 per­­cent increase compared to 2009.

That means the average month­­ly earnings of the working population now stand at almost $70 per month.

On face value, the figures show that the lot of the average Cambo­dian is improving—relatively speaking.

The Council of Ministers said in a statement released Wed­­nes­day that the number of people living un­­­der the poverty threshold is dropping by 1 percent every year and currently stands at 25.8 percent of the country’s estimated 14 million population. That number was 35 percent in 2004.

Cambodia’s new per capita in­come of $830 still means the country falls behind neighbors Thailand ($4,150), Vietnam ($1,110) and Laos ($1,040), and puts Cambo­dians in the company of the population of Tajikistan ($800) and Kenya ($790), according to World Bank figures.

Much of the wealth being created in Cambodia is also stuck in urban areas, and the gap between the rich and the poor is becoming wider, experts say.

What is perhaps even more worrisome is that beyond the garment sector—where wages are already threadbare—there are very few jobs being created, while nearly 250,000 young people are entering the job market every year, most of whom never actually find work.

“[E]conomic growth is largely urban based and the benefits have been unevenly distributed, driving inequality increasingly higher,” the Cambodia Develop­ment Research Institute said in a report released in March.

A mere glance at the growing number of luxury SUVs on Phnom Penh’s boulevards would indicate that the wealth is firmly in the hands of the country’s urban elite, while 80 percent of Cambodia’s 14 million people still live in the countryside.

Minister of Planning Chay Than said the increase in per capita income was not just something that the rich urban class had experienced. He said wealth was being spread through­­­­out so­ciety, though he offered no examples and little explanation on how the government plans to redistribute wealth.

“We aim to do this as part of our strategic plan,” Mr Than said. Asked to elaborate on the government’s redistribution plan, he said: “Reform is needed in agriculture, industry and services.”

Opposition SRP lawmaker Son Chhay questioned the ability of the government to come up with an accurate figure on per capita income.

“Generally, we don’t know how to do it and [know] if it is technically done right,” he said.

To increase wages, CPP lawmaker Cheam Yeap said the government was prioritizing spending in seven key sectors: health, education, rural development, ag­riculture, gender, social affairs and construction.

“These are priority sectors,” he said. “We will have oil next year, and we enforce the property tax in November.”

Some, however, have amassed wealth from other means, Mr Yeap said.

“Some people get money by working and doing business; some people get money by doing corruption and stealing money from the state,” he said.

Indeed, that was the case in July when the Ministry of Fi­nance uncovered that staff at the Ministry of Social Affairs had em­­bezzled $5 million from government coffers through falsified budgets and pensions collected in the names of “ghost” veterans.

For Suzuki Hiroshi, chief economist of the Business Research Institute for Cambodia, one of the largest challenges Cambodia has is working out how to grow the economy while promoting income equality at the same time.

“It will be necessary to get the right balance between equality of income and the speed of economic growth,” he said.

For Cambodia to successfully distribute wealth, there would need to be more growth in the economy, said Mr Hiroshi. New markets need to open up, more jobs need to be created, and private businesses need to be convinced that Cambodia is ripe for investment.

“There are many stages of dev­­elopment in a country,” he said. “At this stage of development in Cambo­­dia, the most important thing is economic growth.”


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