Keynote Address to Close the National Conference on the People's Prosperity through the Achievements from the Implementation of the Rectangular Strategy by the Royal Government 2004-2007

Chaktomuk Conference Hall, 1^st June 2008

1. At first, I would like to express my profound gratitude to Excellencies Member of the Royal Government, provincial/municipal governors, deputy governors and all government’s officials for spending 3 days and a half in a fruitful discussion at the National Conference on the “Prosperity of People through the Achievements from the Implementation of the Rectangular Strategy by the Royal Government 2004-2007”. This is the most meaningful event in which I have precious opportunity to stocktaking and evaluate achievements made the Royal Government as well as the commitments and utmost efforts of Excellencies Members of the Royal Government, provincial/municipal governors and deputy governors to implement the Rectangular Strategy of the Royal Government of the Third Legislature of the National Assembly and for forthcoming years.

2. Based on reports that I have received regularly and the reports presented in the last 3 days and a half reveal immense efforts on enabling Cambodia to achieve development goals by implementing good governance principles, maintaining macroeconomic stability, carrying out reform programs and developing all sectors in order to achieve poverty reduction. I would like to take this opportunity to compliment all government’s ministries and institutions for sacrificing both their physical and spiritual efforts in order to fulfill this noble mission with full responsibly, unity, mutual understanding and determination in implementing development measures and policies that have been laid out by ourselves.

3. Due to the fact that in my Opening Keynote Address, I had detailed and highlighted key points regarding the “Prosperity of People through the Achievements from the Implementation of the Rectangular Strategy”, I would not take much time to mention what I have already emphasized. Therefore, I will focus mainly on key achievements during the Third Legislature and challenges to implementation of the “Rectangular Strategy”, provide some recommendations and to highlight necessary measures to further accelerate development.

I. Major Achievements that the Royal Government Has Achieved in the 3^rd Legislature of the National Assembly

4. Having secured peace, security, stability and united territory, the Royal Government was able to succeed in accomplishing rapid poverty reduction and accelerating economic development that are the most important agenda. As a result, the government of the third legislature of the National Assembly made major achievements as follows:

1^st. The government has strengthened and expanded political stability, social stability and security through the promotion of democracy, state of law, freedom of speech and activities.

2^nd. The government has strengthened the capacity of institutions and human resource by concentrating investment in social sectors such as education and health.

3^rd. The government has gradually improved quality of public governance in Cambodia to ensure predictable, equitable, transparent, timely and effective government’s operation. The government continues eliminating all forms of corruption. For this purpose, the government had produced different legislations and strengthened the capacity and skills of the judicial institutions. We have strengthened the public administration to be more efficient. We have increased the salary of civil servants and armed force to ascertain that they fulfill their duties more effectively.

4^th. The government has maintained stable macro-economy in consistent with the prudent implementation of fiscal policy. The high economic growth in the last 5 year has improved production and productivity both in quantity and quality.

5^th. Having launched the Public Financial Management Reform Program, the government's revenue has increased significantly. At the same time, the government has improved efficiency and equity in the budget allocation by increasing expenditure for social and economic development, especially physical infrastructure, education, health and agriculture, and promoted the rationalization and efficiency of public expenditure which is an important factor to enhance public service and poverty reduction.

6^th. The government has completed the rehabilitation and construction of key infrastructures and created predictable and stable environment for attracting and encouraging investment. In parallel, we also adopted necessary legislations to protect national interests.

7^th. The government has ensured protection and conservation of natural environment for generations to come.

8^th. The private sector had truly turned into the engine of economic growth, investment and employment generation. The government has provided incentives to public and private firms to fully achieve their potential and make contribution to the promotion of own welfare as well as economic growth and social development.

5. I would like to stress that within only short time the government has made significant achievements while other countries might take many decades to move from situation we were facing years ago to the current situation. Inevitably, we will face many challenges and obstacles in the future hence we must march forward quickly by leaping through many periods. From the achievements that we have made we are confident that Cambodia will definitely overcome all obstacles and hardship in the future. These are the indicatives of potential for the Cambodian future. The path which we will take is long and rough.

6. In this regard, the government sticks to the national solidarity to mobilize people's force, domestic and abroad, from all levels and political trends under the motto “Nation Religion King” into unity to build and protect nation and national achievements at the time when the country has independence, sovereignty, territorial integrity, peace, democracy and development under wise guidance and leadership of His Majesty Norodom Sihamoni, the King of Kingdom of Cambodia.

7. Obviously, the implementation of the “Rectangular Strategy” by the Royal Government of the third legislature of the National Assembly has created favorable environment and sufficient conditions domestically and internationally for Cambodia to leap forward with solid hope, confidence, determination on the road of reform and development. The promotion of economic growth, job creation for Cambodian workers, ensuring social justice and equity through the Governance Action Plan (GAP) and ensuring government’s efficiency in the implementation of reform program for all sectors aiming at poverty reduction and sustainable development is the most prioritized political platform of the government of the third legislature of the national assembly. Along with successful implementation of the “Rectangular Strategy” we are also facing with a number of challenges as follows:

II. Challenges

8. Our biggest challenge from now until the general election for the fourth legislature of the National Assembly is to manage inflation. Facing with this challenge the government keeps controlling the situation. The government has introduced continuous measures to tackle inflation, especially to prevent the price of basic goods such as food and fuel from rising too high while the macro-economic stability is being maintained.

9. In the medium term, our major challenge is to ensure high economic growth in the context of low inflation rate in order to accomplish the 4 strategic goals of the “Rectangular Strategy”, namely Growth, Employment, Equity and Efficiency. Therefore, we should explore further difficulties and weaknesses in order to succeed in the implementation of the National Strategic Development Plan (NSDP) and Cambodia Millennium Development Goals (CMDG) outlined by the Royal Government. Hence, we must overcome any obstacle to address the following challenges:

1^st. The economic base is narrow and relies heavily on 4 pillars:  garment, tourism, construction and agriculture sectors. The garment and tourism sectors are quite vulnerable to external risks. The agricultural sector, which consists of 30% of the total GDP and accounts for 60% of total employment, still suffers from low yield and has not become the leading sector yet.

2^nd. Although we have so far reduced the poverty rate from 47% in 1993 to 35% in 2004 and 31% in 2007 through strong economic growth and various supportive policies, the gap between the rich and the poor are growing wider, especially this inequality is higher in the areas where indigenous people live. This might spark social problems in the future. The rural poverty rate remains high at 39%, rural living standard is still low, and economic and social infrastructures are still inadequate.

3^rd. Land concentration and landlessness are on the rising trend which in turn will affect the equity and efficiency of land use. A large number of economic land concessions approved by the government have not been utilized at full potential yet, and they are left unoccupied. Some economic land concessions have been illegally sold and converted into private lands without complying with legal procedures. To address this issue, we must push for the distribution of social land concession to the genuine landless poor but there must be specific measures to prevent them from selling the distributed lands. Moreover, the lost of indigenous people’s land in whatever form will trigger social instability in the future.

4^th. Anarchically illegal possession of land, illegal grabbing of the state land and protected environment area and unlawful logging are still taking place. Moreover, poverty and inflow of emigrants put more pressure on the natural resources.

5^th. Mine clearance is the strategy to minimize casualties caused by mines and unexploded ordinance and to secure land for social and economic use. The challenges seen in this sector include: 1) activities database system does not respond to the requirement of strategic plan preparation to get effective result; 2) financial shortage requires supports from development partners; 3) the authority need a sustained financial package to ensure regular and timely operation.

6^th. The progress toward achieving the goal of the 9-year basic education for all is still limited, especially in post-primary education. The education quality either at primary, secondary or tertiary levels remains low. The problem of drug production and trafficking has become a social problem which might spill negative effects on the welfare of Cambodian youths in the future.

7^th. The shortage in skilled workers is a chronic obstacle to accelerating development of urban and rural economies.

8^th. Low education, domestic violence and human trafficking are the major factors that deprive women from using their full potentials for social and economic development.

9^th. The access to quality public health services is still limited. Obviously, in spite of numerous achievements in the health sector, maternal mortality rate is still high at 472 out of 100,000 live births. The progress in promoting health care services and sanitation in rural areas is still relatively slow as compared the Millennium Development Goals.

10^th. Social safety net for the poor has not become systematic. We just commenced this task by establishing a social security fund for industrial workers.

11^th. Having completed the rehabilitation and reconstruction of the national road networks across the country, our next challenge is to ensure regular and cycled maintenance of the national, provincial and rural roads in a systematic and sustained fashion. 

12^th. Airline sector plays extremely crucial role in tourism development. Hence, flight safety is the key priority to ascertain tourism development and absorption of bigger number of tourists coming to visit Cambodia. But a couple of airline companies possess only old and small aircrafts and is in shortage of fund, consequently the carriage capacity is still limited. The lack of human resource to manage this sector in the future is a big concern of the government.

13^th. The institutional capacity is still limited due to low salary and incentive scheme, inter-institutional cooperation is still limited, some legal documents contains loopholes and insufficient human resource to carry out the laid-out policies.

14^th. We observed that there exists gap between strategies, policies and measures implemented in budget framework.

To address the above issues effectively, I would like to issue measures and recommendations as follows:

III. Recommendations

First - Ensuring Favorable Environment for the Continued Implementation of the Rectangular Strategy

10. We have demonstrated our immense commitment to promote democracy which is the only way to go forward by taking following measures:

·     Ensure the “State of Law” that could provide Cambodian people with  equal opportunity and equity through making legislation, developing  human resource and institutional capacity and training government officials in order to transform courts into an independent, capable and fair institution.

·     Keep protecting human rights in all forms with conformity to the international standard and practice including political and economic rights

·     Strengthen security and eliminate all kinds of crimes

·     Implement decentralization and de-concentration reform to promote democracy and the efficiency of the public service at the local level

·     The authorities of all levels must pay special attention to strengthening security and social safety, especially security for the general election for the fourth legislature in order to ensure that the election will take place in the most secured environment which reflects free election from people's will without any intimidation, and assure that this election is once again the “Mekong Miracle”

·     Keep strengthening partnership with all development prtners such as partnership with development partner community, private sector, civil society by strengthening “Cambodian Development Cooperation Forum” (CDCF) mechanism, raising the efficiency of joint technical working groups and Government and Development Partners Coordinating Committee, and further strengthening the “Government Private Sector Forum” to seek common solution and promote cooperation between the state and civil society on the basis of the state of law aiming at promoting democracy, respect of human right and dignity, social order and respect for law.

11. The government has made utmost efforts to maintain macroeconomic stability in order to ensure high economic growth and stable riel-dollar exchange rate, to keep bolstering and developing healthy and efficient banking sector as envisaged in the “Financial Sector Development Strategy 2006-2015”. Furthermore, the government has taken necessary and urgent actions to tackle inflation timely and cautiously in order to achieve economic stability and minimize adverse effects and ensure sustainable national economic development.

12. The government has been implementing measures to keep inflation in check as follows:

·    Investment in the infrastructure such as roads, irrigation system, power transmission network that will help to reduce economic costs and raise productivity. Under the existing budget law framework, this expenditure must be ensured along with the expenditure on education and health sectors

·     Review and collect stamp duty, unused land tax and capital gains tax which help to cool the real estate sector

·     Continue to tighten expenditure to maintain budget balance which is the foundation for macroeconomic stability and sustained economic growth

·     Maintain riel-dollar exchange rate stability and search for measures to de-dollarize while sustaining the purchasing power of 500,000 workers

·     Monitor and manage credit and money supply in the market.

13.    To ensure favorable financial and macroeconomic environment:

·     Promote the diversification of service and manufacturing sectors by broadening  and sustaining economic base

·     Deepen the successful implementation of the “Public Financial Management Reform” at the 2^nd Platform in order to mobilize revenue and increase expenditure to investment in economic and social infrastructure

·     Government’s ministries/institutions must adopt the action plan of the “Public Financial Management Reform” by ensuring ownership and close cooperation with the Ministry of Economy and Finance through the development of institutional capacity and effective and efficient utilization of the resource and power to manage public finance aiming at increasing budget’s credibility, achieving financial accountability and linking government’s policies to annual budget

·     Effectively implement the “Financial Sector Development Strategy 2006-2015” that the government adopted on 9 February 2007 to develop a comprehensive and interconnected financial sector in order to mobilize resource to support economic growth, in which the focus was given to banking, microfinance, insurance and capital market

·     Materialize the stock market at the end of 2009 as scheduled to expand  sources of financing to all kinds of enterprises and firms, provide public financial saving instrument, establish the financial center to facilitate the financial sector development by installing appropriate infrastructure to facilitate business relation between financial institutions.

14. We must continue integrating Cambodia into regional and international communities by accelerating accession process to Asia-Pacific Economic Cooperation (APEC) and building ASEAN Community by 2015, solving border issues and demarcating borders with neighboring countries, finding solution to overlapping areas and pushing for registering Phreah Vihea Temple as the World Heritage as planned. These are the priority of Cambodia's foreign policy. At the same time, we will continue to search for support to Cambodia's membership as the non-permanent member of the United Nations Security Council in 2013-2014. On the other hand, I would like to ask all ministries/institutions to carefully carry out the duty of membership in WTO. Making, adopting and enforcing law and regulation in the framework of WTO will create favorable condition for Cambodia to expand and bolster economic foundation and bring about opportunities for Cambodia to take fast step on the road of sustainable development.

Second - Good Governance as the Cornerstone of the Rectangular Strategy

15. Various interventions have indicated about the progress of the implementation of Good Governance Action Plan which covers many sectors ranging from legal, judicial to natural resource management reform.

(i) Fighting Corruption

• Promote the implementation of anti-corruption measures through media, education and dissemination to make the public aware of the impacts of corruption

• Strengthen the law compliance and enforcement, which are the core fundamental of democracy and the concrete basis of government activities in ensuring justice, welfare and stability for our nation

• Attract public support and participation to fight corruption

• Establish an internal audit unit within government ministries and institutions

• Ensure transparency in both private and public sectors, especially with regards to the implementation of contracts  

• Strengthen procurement procedures to ensure fair competition in bidding process.

(ii) Legal and Judicial Reform

• Continue to push for the accomplishment of the legal framework by concentrating on the adoption of key legislations to strengthen governance, the court system and the fundamental of the free market

•  Promote law dissemination to the public to allow them to clearly understand the law and to exercise their rights and freedoms appropriately within the legal framework and the principle of mutual respects

•  Continue to promote the law dissemination and training to judges, prosecutors, judicial police officers, and other law practitioners to ensure proper understanding and enforcement of the existing laws and regulations

•  Continue to strengthen the capacity and the responsibility of judges and other law practitioners by developing the statute of magistrates and prosecutors, strengthening discipline and providing quality trainings for judges and prosecutors

• Set up institutional mechanisms that serve the judicial sector including the development of the statute for clerk, notary, arbitrator, and also the assurance of professional quality and competency of the other law practitioners

• Promote legal aids, especially for poor people to protect their rights and interests through the court system

• Promote and enhance dispute settlement mechanism outside the court system.

(iii) Public Administration Reform

• Strengthen the mechanism of the Priority Mission Group in all ministries/institutions by ensuring the consistency with the Initiative of Performance-Based Payment Initiative aiming at strengthening the efficiency, transparency, and accountability in the public services

• Introduce the Special Operation Agency in the ministries and institutions in accordance to their actual circumstances

• Continue to strengthen institutional capacity, training, and human resource management in all ministries and institutions, and increase the use of IT through the E-government programs

• Increase the salary, remuneration, and functional allowance of government officials

• Extend the scope of "One Stop Service" mechanism to eliminate bureaucracy

• Prepare legal documents for smooth and harmonized enforcement of the Law on the Administration and Management of the Capital, Provinces, Municipalities, Districts and Khans.  

(iv) Armed Forces Reform

• Continue the armed force reform through strengthening and enhancing the competency of Royal Cambodian Armed Forces by raising training quality, building successive military officers, modifying the management structure, improving military bases, raising soldiers’ standard of living, enforcing the Conscription Law and strengthening the border and island protection forces

•  Strengthen the skill to fight international terrorism and transnational crimes

• Equip necessary military equipments to facilitate the military mobilization according to geographical condition

• Continue to cooperate with all levels of authorities in order to participate in maintaining political stability and strengthening peace, security, public order and social achievements, especially protecting the upcoming fourth term general election

• Be prepared to participate in rescue missions in any disaster and humanitarian cooperation and helping farmers in farming.

Third - Enhancement of the Agriculture Sector

(i) Improving Agriculture Productivity and Diversification

• Prepare a work plan to respond to the rising food price, by increasing the supply of agricultural products such as rice, corn, bean, cassava, meat and fish in order to carry on the diversification of agricultural products

• Continue to enhance the agricultural productivity in order to increase the yield from 2.5 tons to 3 tons per hectare through strengthening the supporting service such as research, agricultural information dissemination, selection of good seeds, provision of loan, channeling of public investment and motivating private investment in the agriculture sector

• Continue focusing on the use of advanced technologies, the development of agro-industry and the acceleration of investment on rural infrastructures to further improve rural services and infrastructure

• Increase the public investment in rural development, agriculture research and dissemination services which is based on: (1) promoting cultivation, (2) irrigation systems that are managed and owned by farmers, (3) rural enterprises, (4) enhancing the skill and capacity of agriculture and agriculture-based enterprises, (5) supporting the microfinance services

• Establish a quality and sanitary standard, laboratories, quality certification for agriculture export

• Promote farmers’ understanding on productivity and quality through training programs, education, and establishing an agency to monitor and evaluate food’s quality.

• Build the refrigeration infrastructure, refrigerated storage and transport facilities to serve the export.

(ii) Land Reform and De-mining

• Continue to strengthen the safety of land ownership through the registration of the state-owned and private real estates and the registration on the property transfers all over the country, especially in the economic potential areas

•  Build the land and real estate valuation system and implement the Single Window Service to ensure transparency in the future registration

• Create an inventory of state-owned property step by step in order to build only one database system

• Create the land information system, which is a basis of the national physical data infrastructure

• Promote the land registration in the indigenous communities, the registration of the co-ownership, and the introduction of measures to prevent illegal trade of the community land

• Prepare the legal framework to implement the Expropriation Law, Pre-emption and Land Development Law

• Strengthen and speed up the land dispute resolution mechanisms outside the court system

• Establish a land management planning system such as national strategy for city development, zoning based on land use planning, management of land planning, development plan for urban and rural areas and the monitoring of the development process

• Integrate the land use planning with the participation from all relevant institutions as well as speeding up the preparation of guidelines on the principles of land use to support the decentralization and de-concentration policy

• Adopt the Decree on Construction and Urbanization and a national standard of construction

• Promote the collection and listing of the inventory of the state property

• Establish and implement the medium and long term land distribution strategy and framework by ensuring transparency in order to prevent the illegal land encroachment on any state land

• Implement the partnership between small farm owner and large farm owners, agricultural corporation and social and economic land concession through land distribution in the framework of rural development

• Update the National Strategic Plan in order to eliminate the accidents caused by mines and UXOs, and speed up the pace of de-mining to clear the prioritized land by 2015 and remaining land by 2020

• Continue to strengthen the de-mining decentralization in cities/provinces

• Strengthen the international cooperation to search for new technologies in order to boost the de-mining progress to meet the target set in the work plan.

 (iii) Fisheries Reform

• Continue to strengthen both the capacity and management of fishing communities as well as establishing conservation sites, releasing fishes and spawned fish species in fishing communities and linking the fishing communities with the eco-tourism, which is the potential to be extended

• Promote the development of aquaculture all over the country including the sea and freshwater through creating the fish breeding places in local communities by transferring technologies to farmers through the key farmers, especially in fish breeding

• Strengthen all kinds of commercial fishing to be more effective by setting the proper fishing tools in each region in order to ensure the sustainability of fish as well as to allow fish to grow

• Pay attention to the protection of inundated forest and sparse forest that are the important shelters for fish, especially the prevention of dam construction and anarchic cutting of inundated forest to cultivate the dry-season rice in fishing areas by encouraging the participation from the competent authority and various relevant local authorities

• Make all necessary efforts to protect reserved sites and deep water areas aiming at conserving different spawned fishes for the reproduction in Tonle Sap and the lower part of the Mekong River Delta

• Strengthen the enforcement of Fishery Law by taking strict measures on the illegal forest clearance, fishing by using illegal tools and other anti-conservation activities.

(iv) Forestry Reform

• Continue to improve the effectiveness in preventing illegal forest clearance for private ownership through strengthening the enforcement of Forestry Law and other relevant regulations in order to completely eliminate anarchic activities

• Encourage community members to help protect the forest through capacity building and proper exploitation of the community's forest

• Motivate the re-forestation, especially in the areas of degraded forest either in the form of community work or private investment by creating a clear cut legal framework to ensure that the implementation can be effectively done and to prevent the use of law as an instrument for deforestation

• Promote the conservation of protected forest and wildlife in a sense to promote the environment and the eco-tourism development

• Continue to pay stricter attention to the process of the private concession forest conforming to the law and legal framework and the concession forest contract.

Fourth - Further Rehabilitation and Construction of Physical Infrastructure

(i) Further Rehabilitation and Construction of the Transport Network

• Continue to renovate and rebuild all kinds of transport networks including roads, bridges, railways, waterway, ports and airports linking all areas in the country either in cities, towns or remote areas as well as connecting with neighboring countries to become a transport system, which is convenient, stable, safe, and economically efficient with low price

• Approve the Road Law to provide the legal framework and clearly set the roles and responsibilities of the Government institutions on the construction and maintenance of roads

• Promote the participation from the private sector in order to provide the road transportation service and infrastructure

• Create the clear cut mechanism for road maintenance.

(ii) Water Resources and Irrigation System Management

• Continue to renovate and rebuild the irrigation infrastructure, water reservoirs, canals, sewers, drainage systems, delta canals, flood and seawater protecting dams, and water pumping stations in order to broaden irrigated areas and improve cultivation through promoting the public investment, further attracting resources from development partners and motivating the private sector participation

• Strengthen the management, the protection and the use of freshwater, seawater and sea resources by ensuring sustainability and equality and effectively serving the public interest

• Increase the effectiveness of participatory irrigation management to relieve the Royal Government’s burden in managing the irrigation network and to increase the social capital through farmer education and promotion of the collective action at the local level

• Push the management and use of the decentralized irrigation systems, which are owned by the people, to supply water for cultivation, to facilitate travels, to implement the hydro-farming and to strengthen the capacity of the water-using farmer community

• Promote and encourage the improvement and maintenance of rivers and natural lakes to serve the common interest.  

 (iii) Development of Energy Sector and Electricity Network

• Increase domestic production capacity through building hydro-electrical plants, coal plants and the import of electricity from neighboring countries such as Laos, Thailand and Vietnam to fulfill domestic demand

• Integrate Cambodia's electricity system into the networks of Greater Mekong Sub-region countries and ASEAN through successful implementation of the strategic project of GMS on energy, infrastructure and ICT cooperation.

• Attract investment in electricity distribution to facilitate participation of the private sector by providing sufficient and proper incentives

• Improve technical capacity and equip necessary equipments for the electricity sector

• Continue to set up electricity distribution networks to link all provinces and cities of the Kingdom of Cambodia to a single national network through both public investment and Build-Operate-Transfer (BOT)

• Divert from using wood as the energy to the use of natural gas, bio-gas, electrical power, hydro-electricity, wind, sun and waste and so on.

(iv) Development of Information and Communications Technology

• Create legal framework to implement Law on Telecommunication, particularly the establishment and improvement of Cambodia's telecommunication regulator's capacity

• Improve equipments and technical materials to have telecommunication and post covered throughout the country

• Create market competition over telecommunication and post services

• Strengthen human resources and management of telecommunication and post

• Continue to implement Government Administrative Information System (GAIS) and E-government

• Promote the installation of the fiber optic system to link capital to provinces and cities.

Fifth - Private Sector Development and Employment Generation

(i) Strengthening the Private Sector and Attracting Investments

• Continue to implement the investment policy in physical infrastructure such as roads, bridges, water, and electricity to lower business costs, enlarge domestic market, reduce transportation cost and make travel safe

• Strengthen key legal frameworks to support transparency in the private sector development, especially the laws that shall be adopted and implemented within the framework of World Trade Organization

• Improve the investment climate such as laws, regulations and administrative requirements and promote the possibility of key inputs such as skilled staff and competition

• Continue trade facilitation reforms, strengthen monitoring mechanism and solve conflicts efficiently

• Foster integration into ASEAN, especially through strategic partnership plan for economic cooperation with neighboring countries

• Promote the existing textile and garment industry and provide incentives for investments in footwear industry

• Be ready to create a favorable condition for the development of machine and electronic spare parts

• Promote the food processing industry in Cambodia for export and import substitution industry focusing on cassava, palm oil, frozen food, rubber, tropical fruits and agricultural organic products

• Develop clear regulations for the operation of Special Economic Zones and ensure industrial infrastructures such as electricity, water and waste water treatment.

(ii) Promotion of Small and Medium Enterprises

• Strengthen the legal system by creating the Law on Factory, Law on Industrial Zones, Law on Patent and Industrial Invention, Law on Measuring Tools, Law on Industrial Safety, etc

• Further promote domestic investment, especially industries that use domestic resources such as small and medium enterprises

• Prevent all kinds of smuggling

• Promote the establishment of National Productivity Center, aiming at helping small and medium industries through the increase in productivity and reduction of production costs

• Create National Standard Institute, aiming at making the quality of domestic products to the regional and international standards

• Create the national laboratory in physical chemistry, micro-biology, mechanics and testing, in which the evaluation is based on product quality and features

• Strengthen protection mechanism on industrial intellectual property rights which prevent illegal copy and promote innovation, technological development and high tech as well as new products

• Create business development service in partnership with public/private sectors and help facilitate responses to business development service providers.

(iii) Job Creation and Ensuring Better Working Conditions for Workers and Employees

• Continue implementing policy linking trade to employment condition through the effective practice of labor standard and labor law

• Strengthen the relations with partner countries to export Cambodia's labor, aiming at improving skills, reducing unemployment rate and increasing income for Cambodians

• Continue providing professional and technical training in response to the market demand by focusing on drop-out young students at secondary and high schools, disable people, women, marginalized groups and the minorities

• Develop a labor market statistical system, national innovation framework, national standard for competencies, and labor market system as basis for preparing the right training plan and helping graduate students to easily seek information on labor market demands

• Strengthen existing mechanism of labor dispute solutions such as Arbitration Council, demonstration and strike solution committees at all levels, training voluntary mediators among local authorities to solve labor disputes peacefully and ensure sustainable employment

• Strengthen Labor Law enforcement through training, field visit at factories, enterprises, and institutions across the country to inspect labor condition, sanitation, health, labor safety, child labor, and employment of foreign labor and practice of union freedom in accordance with Labor Law and regulations

• Conduct research study and cooperate with institutions and relevant partners to develop draft Law on Labor Union and draft Law on Labor Court.

 (iv) Establishment of Society Safety Nets for Civil Servants, Employees and Workers

• Promote good governance in the provision of safety nets through strengthening institutional capacity and cooperating with development partners

• Extend social services and emergency relief program widely

• Promote child welfare and youth rehabilitation who will be our nation's successors

• Continue to promote public service quality for the handicapped and disabled people who are unable to work and provide supporting service for veterans

• Improve the implementation of veteran and government officials' retirement through pension schemes, which has wide coverage by preparing, adopting, and implementing “Law on National Social Security Fund” and the "Law on the Creation of the National Social Security Fund for the Veteran" 

Sixth -  Capacity Building and Human Resource Development

(i)  Promoting and Strengthening Education Quality

• Promote the enrollment in both primary and secondary education, especially at the rural and remote areas by building more primary, secondary and high schools to facilitate the poor kinds to have access to education

• Train more teachers and implement the teacher deployment policy effectively

• Strengthen the education quality in every area through the improvement of course curriculum and training programs for teachers and the supplementary teaching method

• Continue to improve education quality by providing incentives to teachers  and outstanding students as well as enhancing the learning condition such as increasing educational materials, equipments, libraries and laboratories; and building dormitories for students, especially female students

• Incorporate a new point in the policy for teachers, which is to allow teachers at the primary and secondary levels that have continued their studies and completed Bachelor degree, to apply for the high school teachers through the competitive exam regardless of age. At the same time, there is a need to set up criteria for teachers at the primary level, that have no high school degrees, in which there are about 43,000 of them at the present time, to be able to take exam for the degree equivalence to the high school degree in order to allow them to continue their studies to the tertiary or post tertiary level and to change their wage rate. The Ministry of Education, Youth and Sport must prepare a separate examination for both teachers at primary and secondary levels by starting from 2008.  

• Expand the informal education through opening the literacy and vocational training classes, increasing the constructions of community study centers as well implementing the equity program

• Promote the technical and vocational skill training for the secondary school graduates

• Increase university enrollment by creating more universities at the provinces/cities and strengthening the partnership between public and private sector in order to enhance education service in accordance to the international standard

• Strengthen tertiary education quality and promote the technical skill training to have enough resources to respond to the labor market and promote the technological and scientific researches.

 (II) Enhancing Health Services

• Strengthen governance in the health sector through implementing the sectoral management approach by focusing on the promotion of ownership and accountability through the effective harmonization with all partners including international communities and private sectors in order to increase more investment in the health sector

• Promote the accessibility of the favorable health service accessible to the public by implementing the decentralization on service and management functions

• Strengthen health service, especially reproductive, mother, infant, and children health services through Equity Fund and health assurance

• Strengthen the implementation of the health regulation, professional ethics and statute, and also reinforce the regulation mechanism to ensure the rights of the health service providers and clients

• Strengthen the defense and preventive measures on contagious diseases, health care and nutrition

• Continue to reduce maternal and infant mortality rates and other main health indicators by conducting the prevention and treatment program of the contagious diseases, building the referential hospital and health center throughout the country

• Strengthen the public health intervention to address the challenging interconnected issues, especially gender issue, the health of indigenous people, sanitation and health in schools… etc.

• Increase the number and deployment of doctors, nurses and midwives who have got appropriate trainings as well as educating and comprehensively disseminating health and hygiene information, especially at the rural areas

• Increase the investment on physical infrastructure, health facilities, and technology as well as promoting other supporting services   

• Further strengthen and extend Equity Fund for the poor to access to the free, efficient and equitable health services

• Accelerate the decentralization power in managing the sub-national level such as national hospitals, referential hospitals and health centers.

 (iii) Gender Policy Implementation

• Continue to enhance gender equity and mainstream this issue into all line ministries/institutions

• Improve women's capacity in order to get high positions in the public administration and to increase the participation of women in the decision making process

• Increase accessibility of women to financing and create opportunity for women to participate in quality work

• Ensure equal rights of women in the use of economic resource and the participation of development through promoting micro-credit program, providing Business Development Service to the rural women and small scale entrepreneurs by providing them training in businesses like vegetable, fruit, food processing, marketing as well transforming from the "Women Development Center" to "Women Entrepreneur Center".

• Continue to fight against domestic violence and human trafficking by effectively implementing the Law on Anti-Domestic Violence and Protection of Victims, and other Laws on Human Trafficking through promoting the legal protection for victims and raising the public awareness on domestic violence

• Increase the enrollment of both boys and girls at the secondary level as well as reducing the gender gaps in education

• Continue to build dormitory for girls in order to facilitate and provide safety for female students

• Increase the scholarships and opportunity to female students.

 (iv) Population Policy Implementation

• Strengthen the population quality through the development of education, health, gender equity, and rural development; and reproductive health policy implementation

• Link to the infrastructure management policy to the population policy in accordance with the population growth

• Reduce the gaps between urban and rural areas through the provision of similar public services including schools, hospitals, bridges and roads... etc.

• Strengthen the city and urban management to become clean city with hygiene, good environment, fresh air, green parks, sports center, gymnasium; and cultural and entertainment program is organized to physically and morally support the health of people

• Strengthen the prevention of the human trafficking and drug use, particularly in youth through law enforcement and deepening awareness campaign on danger of drug use to all level of population

• Pay attention to the public investment in remote areas in order to increase jobs and living standards, particularly to infrastructure investment, roads, hospitals and schools...etc. 

17. After active and vigorous discussions by gathering all knowledge during the three-and-a-half day national conference, we have evaluated the result performed in the third term of the Royal Government and refined priorities, by mainly focusing on economic policy agenda and poverty reduction through detail preparation, selection and highlighting of the government’s economic policy agenda into the political platform of the Royal Government of Cambodia in coming 4^th legislature of the National Assembly. After vigorous consideration on the laid-out challenges and recommendations, I have made decision to continue the implementation of "Rectangular Strategy" in the fourth term of the Royal Government. I suggest the Supreme National Economic Council to review the "Rectangular Strategy" by gathering all knowledge resulting from thorough discussions during the three-and-a-half day national conference, particularly based on challenges and recommendations that I have just laid out as inputs in preparing the 2^nd "Rectangular Strategy" that is a common political platform and national agenda for all reform areas in order to achieve progress of the Royal Government of the fourth term of the National Assembly, which will be established after the General Election on 27^th July.

18. Taking this opportunity, I would like to highly complement leaders and officials in all ministries/institutions for their efforts in actively and responsibly participating in the implementation and achievements of Royal Government's Rectangular Strategy, and I also suggest all of you to put further efforts and overcome all challenges to bring about new achievements for the country.

Finally, I would like to wish Excellencies, Ladies and Gentlemen the five Buddhist blessings and also wish the upcoming General Election successful. I would like to close the National Conference on the "Prosperity of People through the Achievements from the Implementation of the Rectangular Strategy of the Royal Government" from now on.

EndItem.