Phnom Penh City/Photo: Manuth Buth/UNDP Cambodia

A Quick Glance

Cambodia continues to rapidly modernize, with its economy shifting from an agricultural base towards industry and services and its economic performance translating into poverty reduction. As the country aims for upper middle-income country status, it faces critical challenges, including the repercussions of the COVID-19 pandemic and war in Ukraine, to ensure this growth continues and results in shared prosperity, environmental preservation and improved governance. 

The ‘Policy and Innovation Hub for Sustainable Development’ aims to assist Cambodia in attaining these sustainable growth aspirations. The Hub supports the preparation of a national plan that integrates the 2030 agenda for sustainable development, the development of policy research, the expansion of the base for development financing and the promotion of innovative solutions across three pillars of UNDP’s Country Programme 2019-23: prosperity (inclusive and sustainable growth), planet (environmental protection and climate change adaptation and mitigation) and peace (opportunities for all to contribute to and benefit from Cambodia’s transformation). It further supports government policies and innovative measures that can respond to the new challenges presented by COVID-19 in order to build resilience during and after the pandemic.  

Key areas of intervention include driving improved productivity and competitiveness through research and policy work on the national development plan, human development, Industry 4.0 and pilot initiatives to digitalize small and medium enterprises; combatting inequality and eradicating poverty through gender research and social protection models; tackling climate risks and sustaining Cambodia’s natural resources and biodiversity through policy and programming support and sustainable financing; promoting green growth through research and policy support for a circular economy and renewable energy; creating space for accountability and civic participation through support to monitoring and reporting of the National Strategic Development Plan and CSDGs, development financing, building social cohesion, gender inclusive policy, systems transformation, and alternative media; and building resilience in the face of COVID-19 through policy support and COVID-19 socioeconomic response initiatives.  
  

Project Focus

The project focuses on the following results:

• Formulating government policies and innovative measures/initiatives in support of sustainable and inclusive development;
• Developing government policies and innovative measures/initiatives in support of the preservation of national environmental endowment and combatting climate change;
• Formulating policies and innovative measures/initiatives to foster greater participation and accountability; 
• Supporting government policies and innovative measures/initiatives to respond to the impacts of the COVID-19 pandemic and to build back better; and
• Initiating small-scale pilots to drive digital transformation and e-commerce uptake to support resilient livelihoods and sustainable economic activities. 

Pillar 1: Prosperity (inclusive and sustainable growth)

• Driving improved productivity and competitiveness through research and policy work on the national development plan, human development, Industry 4.0, and pilot initiatives to digitalize small and medium enterprises;
• Fostering innovative financing options for SDG achievement;
• Combatting inequality and eradicating poverty through gender research and social protection;

Pillar 2: Planet (environmental protection and climate mitigation and adaptation)

• Tackling climate risks and sustaining Cambodia’s natural resources and biodiversity through policy and programming support and sustainable financing;
• Promoting green growth through research and policy support for a circular economy and renewable energy;

Pillar 3: Peace and participation (opportunities for all to contribute to and benefit from Cambodia’s transformation)

• Creating space for accountability through support to monitoring and reporting of the National Strategic Development Plan and CSDGs; 
• Building social cohesion, gender inclusive policy, systems transformation, and alternative media;
• COVID-19 response and recovery
• Building resilience in the face of COVID-19 through policy support and COVID-19 socio-economic response initiatives. 

Project Results From 2019-2022

Supporting Inclusive and Sustainable Growth:

Since 2019, the Policy and Innovation Hub has provided important policy support, research and advocacy to encourage more inclusive and sustainable growth in Cambodia. This has included support towards the development of Cambodia’s National Strategic Development Plan 2019-2023, which ensured the integration of the Cambodian Sustainable Development Goals (CSDGs) into policymaking and the monitoring of their progress. Under the project, new funding was received from the Joint SDG Fund to develop an Integrated National Financing Framework for Cambodia that can support the achievement of the CSDGs using innovative financing options. An updated Development Finance Assessment was further launched in time to inform the country’s national financing strategy and the establishment of a new economy department at the Ministry of Economy and Finance. In 2022, the project developed the country’s first market intelligence guide to SDG-aligned investment through the SDG Investor Map and delivered a feasibility study along with technical support for the issuance of a sovereign bond – raising approximately US$17.6 million for financing socioeconomic development.

A social protection scheme that pilots a poverty graduation package comprised of assets in addition to cash for poor and vulnerable populations was designed with funding secured from the Russian Federation to support the implementation. Key policy research has also been conducted through the project, including the 2020 Meeting the Costs and Maximizing the Impact of Social Protection in Cambodia report, which estimated the cost of implementing a comprehensive system of social safety nets to address economic inequality and exclusion. The findings provided empirical evidence of the affordability and efficiency of tailored social protection interventions to the Royal Government of Cambodia. In 2022, the Hub also used big data and artificial intelligence to perform multi-dimensional poverty mapping and socioeconomic tracking that makes vulnerability information publicly available.

To create sustainable employment opportunities during economic downturns, UNDP partnered with the Ministry of Commerce and Khmer Enterprise to support a Micro, Small and Medium Enterprise (MSME) Incubation Programme that built the capacity of 101 MSMEs (39 percent women-owned) on digital transformation. Twenty-two of these MSMEs reported increased revenue after the programme and 306 new jobs were created.

The Hub has also supported Cambodia’s policymakers and the next generation of workers and industries in the transition towards Industry 4.0, with the Adaptation and Adoption of Industry 4.0 in Cambodia scoping report published in 2019 and the establishment of two Industry 4.0 centres of excellence. Two digital economy labs were further set up at one of Cambodia’s prominent universities to prepare the Cambodian workforce for the digital economy transition. These initiatives are critical to prepare youth for the future of work and to increase industrial value added, diversify exports and strengthen small and medium enterprises. Two policy dialogues were additionally held through the project’s support in 2019 to stimulate conversations on the Belt and Road Initiative, economic diversification and sustainable development among policymakers, development professionals and academia. 
 

Enhancing Environmental Protection and Combatting Climate Change:

To support the preservation of Cambodia’s natural resources and combat climate change, the National Human Development Report Sustaining Natural Resources for All was developed through the project in 2019. The report provides key recommendations for national planning to manage resources more effectively. Actioning one of the recommendations of the report, the Hub worked with Cambodia’s Forestry Administration to launch the digital platform KjuonGo, which supports the production of sustainable charcoal to reduce forest pressure from the demand for wood fuel. KjuonGo was piloted in five community forests, where 10 hectares of land was also reforested with the project’s support. Additional recommendations from the report were taken up by the government through initiatives covering payment for ecosystem services, sustainable financing, and an environmental management and information system for Cambodia. In collaboration with OHCHR, the project also supported in-depth consultations in 2022 between the Ministry of Agriculture and the National Assembly with 300 indigenous peoples and communities across the country on the formulation of two draft amendments to the laws on forestry and protected areas. Following progress made at COP26 on Article 6 of the Paris Agreement, an assessment of carbon market potential of Cambodia’s Nationally Determined Contribution (NDC) was carried out to inform Cambodia’s Ministry of Environment on how to strategically assess carbon markets without compromising NDC achievement.

Through research and advocacy efforts with policymakers on the transition towards a circular economy, the Ministry of Environment (MoE) and National Council for Sustainable Development (NCSD) established a special taskforce on plastic and adopted a ‘4Rs’ framework (Refuse, Reuse, Reduce, Recycle) to lead plastic reduction action within the ministry. In 2021, a further milestone was reached through the project’s support when the country’s first Circular Economy Strategy and Action Plan was launched. The strategy solidifies a national commitment to tackle waste and climate change challenges. A first step in implementing actions under the strategy was taken with support from the project to create a private sector platform to engage and support businesses in their efforts to become more sustainable. In Kep province, a circular economy pilot was undertaken and has created a sustainable waste management model that can be applied to other smaller towns in Cambodia that have limited access to infrastructure and technology. The project also supported formulation and funding for new initiatives to tackle waste, including the Combatting Marine Plastic Litter in Cambodia project funded by the Embassy of Japan and a regional initiative to manage COVID-19 medical waste with support from China’s South-South Cooperation Assistance Fund. In 2022, a key milestone was achieved with the development of a draft sub-decree on plastic management which will introduce important measures such as the ban on some single-use plastics to significantly reduce plastic use and pollution in the years to come. A roadmap for implementing extended producer responsibility (EPR) was also drafted as a measure to mobilize plastics producers/importers to be financially or physically responsible for waste collection and recycling.

The project has developed a number of key knowledge products to support the uptake of renewable energy and to promote energy efficiency. In 2019, the De-risking Renewable Energy Investment report was prepared in collaboration with the MoE and NCSD, making the case that de-risking measures are cost efficient and the economic benefits outweigh their costs. To support more widespread understanding and uptake of renewable energy and energy efficient practices, accessible booklets on solar energy and energy efficiency were developed and released with the project’s support. In 2022, a study on quotas policy for rooftop solar PV promotion was developed to help overcome existing policy gaps and enable greater investment in rooftop solar. The policy brief Building Energy Regulations – Accelerating Low-Carbon Development in Cambodia was also published during the project period to provide insight for policymakers to foster green growth in the buildings and construction sector. This paved the way to support the government’s finalization of the Roadmap for Low-Carbon and Climate-Resilient Buildings and Construction in Cambodia, Vision to 2050 to help attract financing for a more sustainable sector. In 2022, four electric vehicle fast charging stations were installed to promote e-mobility.

A series of pilot programmes have been tested to support the transition towards renewable energy and climate action. The project worked with EnergyLab Cambodia on the development of small scale, low-cost and innovative clean energy solutions. Three of the start-ups were supported with seed funding from UNDP and have created 63 jobs, including 47 for women, as of 2021. A Clean Energy and Agriculture Incubator Programme was also launched to pre-incubate 10 business ideas, four of which were selected for an incubation programme by an investment committee. From 2020-2022, the project went on to finance the piloting of solar micro-grids, providing 405 remote households with access to electricity. The grids have been shown to free up productive time for women and girls by reducing the need to collect firewood and have improved the security of women and girls at night. An additional pilot initiative of 20 mobile air quality sensors was completed, showing the feasibility of using innovative and low-cost sensors to map pollution levels in Phnom Penh. 
 

Fostering Peace, Participation and Accountability:

Since 2019, the Policy and Innovation Hub has engaged in significant advocacy efforts for more inclusive access to social security programmes. This has supported the inclusion of persons with disabilities and the development of a HIV-sensitive screening process for IDPoor cards, which give citizens access to Cambodia’s social security programmes. From 2019-2022, 9,704 persons living with HIV and 10,401 persons with disabilities gained access IDPoor cards through these efforts and were therefore able to access the government’s emergency cash transfer programme. 

The project also supported Cambodia’s first Voluntary National Review in 2019 on its SDG advancement, and a progress report on the CSDGs in 2020. 

The Hub has further advanced policy research for gender equality and women’s empowerment, with a gender wage gap analysis completed for the Cambodia Gender Economic Assessment in 2019. Additional findings and recommendations to work towards closing the existing gap were put forward through the Gender Wage Gap in Cambodia study published by UNDP in 2021. The project also supported the Ministry of Women’s Affairs to develop a roadmap for gender-responsive budgeting, which will be implemented in the 2023 fiscal year, and a draft National Policy on Gender Equality. 

The project additionally encouraged participation through building sustainable, alternative media channels. Three media labs were held from 2019-2020 to cultivate space for discussions around media sustainability, freedom of expression and civic participation in digital spaces. 

In 2021, the Cambodia Futures Lab was initiated to bring together leaders from government, civil society, private sector and UN agencies. Through the Lab they embarked on a collective leadership and learning journey to transform systems for a more inclusive and sustainable future. 

Building Resiliency During and Beyond COVID-19:

In response to the onset of the COVID-19 pandemic, UNDP created a portfolio of work under the Policy and Innovation Hub to address the immediate challenges presented by COVID-19 and the opportunity to build back better.

Supporting the most vulnerable through emergency support, social protection programming and economic opportunities:

The project undertook comprehensive modelling of COVID-19’s socioeconomic impact in 2020, which was published in a policy brief to support the Royal Government of Cambodia’s development of an inclusive economic stimulus package. The package allocated around 5.1 percent of GDP towards supporting the most vulnerable. It further supported the development of an emergency social protection framework for the Royal Government of Cambodia to roll out cash transfers to poor households by providing 1,700 tablets to digitally register IDPoor households. Updated socioeconomic impact modelling was undertaken in 2021 with UNDP’s support, which made the case for continued investment in social protection and supported the government’s decision to continue the cash transfer programme throughout 2021. In 2022, an Impact Assessment of Cambodia’s COVID-19 Cash Transfer Programme for Poor and Vulnerable Households was conducted with the General Secretariat of the National Social Protection Council and the Ministry of Economy and Finance, providing key evidence that supported extension of the programme until 2023. The programme has supported around 700,000 poor and newly poor households with emergency cash transfers. In addition, a targeting mechanism for lockdown cash support was developed and 100,000 families received emergency cash transfer support during lockdown. To strengthen the country’s on-demand IDPoor programme, the Hub supported the development of a new questionnaire, a digital feedback mechanism and a monitoring and evaluation system in 2022 that will ensure more accurate and inclusive identification of households receiving social assistance, including cash transfers.

To generate evidence on the pandemic’s impact on the most vulnerable, survey research on the impact of COVID-19 on MSMEs and informal sector workers was undertaken and made available online with the support of the UNDP Accelerator Labs. As one of the most affected groups, 600 informal waste collectors, including 473 women, received personal protective equipment and food as emergency support. An onboarding programme was also launched, which has enabled 1,619 MSMEs to transition online, thereby building the resilience of their businesses during the pandemic and as the digital economy expands. In addition, 1,677 farmers were supported to sell their agricultural commodities online, allowing them to sell products more quickly, use secure and instant payments, and access small loans without collateral.

The Hub also supported the development of sanitary protocol and the supply of sanitary equipment to the General Department of Customs and Excise in 2020 to prevent the spread of COVID-19, while facilitating the continuation of cross-border trade.

Building a green recovery path from COVID-19:

New funding was mobilized by the project through UNDP's Rapid Financing Facility in 2020, which included environmental initiatives to support Cambodia’s undertaking of a green recovery from COVID-19. Through this funding, the Ministry of Mines and Energy was supported to complete an energy efficiency code for buildings, as well as rooftop solar PV guidelines. The mandate of a new energy unit within the Ministry of Economy and Finance was also finalized to ensure its sustained role in decision making.

Sustainable e-commerce initiatives were further supported through the project. A ‘Doing Guide for Sustainable e-Commerce’ was produced and disseminated to raise awareness and promote environmentally friendly business practices. Based on this guide, 344 vendors and merchants (46 percent women) were trained on sustainable e-commerce, to support a reduction in the amount of plastic waste used in operating their businesses. Three enterprises were supported to initiate and pilot business ideas and products to address plastic pollution.  

Promoting solidarity, social cohesion and the flow of accurate information through alternative media:

In response to the threat of prevalent misinformation and stigmatization during the pandemic, the project engaged a range of social media influencers and media start-ups to produce fact-based messaging and to promote solidarity. One million people were reached within the first two weeks of the pandemic through the project’s campaigns to prevent the spread of COVID-19 misinformation, and a media collective was funded to support start-ups with the ability to reach niche communities.

With parallel support from the UNDP Oslo Governance Centre, an assessment of information pollution in the context of COVID-19 was completed. The research revealed the types of information sources most often consumed, how Cambodians discern between credible and non-credible information, and key means to address disinformation.