Government should focus on reforms and not fall prey to opposition rhetoric

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The World Bank’s latest report shows that the estimated growth rate for Cambodia in 2018 was 7.5 percent- it was the highest growth in the past four years. The driving forces of growth are rapid expansion of exports and robust internal demand.

To main high growth, the report suggests that Cambodia needs to productively absorb rising FDI inflows and promote domestic investment.

Cambodia’s GDP in 2018 registered at about $24.5 billion. Some have forecasted that Cambodia’s growth will slightly moderate in 2019 with an estimated growth are of 7.3 percent and in 2020 with an estimated growth are of 6.8 percent.

In terms of exports, the country registered a four percent growth in 2018, totaling $11.2 billion of which more than half was the export to the EU.

Per capital income is also expected to grow to about $1,600 this year- it has also grown slightly from $1,500 registered last year.

Against this seemingly positive backdrop, Cambodia is expected to enjoy quite vibrant economic growth in coming years. But there are certain headwinds that the Kingdom needs to face.

Th external pressures such as the revocation of the EU’s Everything But Arms trade privileges, the possible revocation of GSO status by the United States (usually the EU follows the United States but this time around, it appears to be the reverse), and the escalating trade war between the United States and China, could collectively spark a tidal wave of economic backlash on Cambodia.

Another headwind that Cambodia might run into would be the effects of domestic politics, some of which are intertwined with foreign policy initiatives.

Concerned observers and friends of Cambodia are wondering whether it would be worthwhile for Cambodia to focus on tackling foreign policy issues and their impacts on trade rather than continue to engage in fruitless battles with the outlawed opposition party or movement.

Sometimes it is inherently difficult to differentiate which of the verbal rhetoric between the recalcitrant political has been or the equally virulent official counter narrative by the government and its leaders is more potent and dangerous.

The jury may be out on this, but it is quite obvious that the Prime Minister is exerting a lot of energy and effort to go toe to toe with the once formidable opposition leaders who are now a shadow of themselves. The opposition leaders have used tactics to stir emotive reactions from the ruling elites.

The more reactions and counterreactions from the government, the more political leverage the opposition leaders can exert, especially to portray themselves as the victims of what they called “illegitimate Phnom Penh regime”.

Progress has been made against seemingly insurmountable odds, especially with the national and sub-national levels not working in tandem with each other and each segment of the government operating in what seems to be a silo mentality.

The obvious is that expediting and enforcing economic, structural, social and foreign policy reforms are more critical than spending times and efforts to counter the narratives of the opposition leaders.

Cambodia is at the cross roads insofar as economic, social, policy and structural reforms are concerned. Without a prudent, transparent institutional surgery, the legitimacy of the government will erode, even without the triggering from the opposition movement.

Some have predicted that there would be a cabinet reshuffle in 2020, some senior and underperformed ministers would be asked to resign or retire- an exit in honor. However, concrete reform results do matter as it is more challenging to earn people’s trust and respect.

Leadership succession within the ruling party is another matter of concern. Currently, it seems that is no long-term and clear plan and strategy yet with regards to leadership transition.

The power structure needs to be more institutionalized and decentralized so that future power transition will be stable and peaceful.

Cambodia needs to focus more on reforms and less on countering the opposition. The sources of regime legitimacy rely much on the opportunities that the government can deliver for the people, the strengthening of social justice, and the enhancement of public trust in the government through the improvement of public service delivery.

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