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Cambodia - Structural Adjustment Operation Project (English)

Ratings convey a satisfactory project outcome, likely sustainability, and modest institutional development impacts. Lessons first address political stability as the major factor, actually a prerequisite, in fulfilling the successful implementation of macroeconomic and structural reforms, and, remains a critical factor in structural adjustment reform in Cambodia. Nevertheless, while the ownership of the project resided with the senior officials, it was apparently less so among the ministries, and technical staff involved in the program. An effective vehicle would need to be instituted to involve mid-level, and technical staff in the preparation of structural adjustment programs. It is noted the structural adjustment program dealt across ministries, and agencies without proper, and effective mechanisms to enhance its implementation. There is a critical need for a specific inter-ministerial steering group, dedicated to assume the leadership of the operation, and a secretariat with representatives from affected ministries, and agencies for implementation of the operation. These two groups could help the Project Management Unit overcome some of the bottlenecks, due to the country's weak civil service, and to deal with potential rivalries among agencies. This also leads to the availability of technical assistance from donors, and strong Bank team support, extremely crucial in low-income country with weak technical, working capacity. Lessons further reinforce the need for Bank staff continuity, particularly that of the Task Manager; for strong dialogues with the Government, and, of specific provisions, such as Intersectoral Steering Committees, or Public Advisory Commissions, to help maintain and retain the momentum of reform. In addition, lessons also address the need for legal draftsmanship of conditionalities, to be consistent between the Letter of Development Policy, the Development Credit Agreement, and the Policy Matrix, especially in reference to performance expectations involving third parties (concessionaires), and qualitative actions (restructuring, consultation). Moreover, the multi-tranche release credit presents a challenge to the government in fulfilling the conditions for the floating tranche, and the second tranche releases, given the fragile political reality in the Borrower country. It is thus suggested, the reform process in Cambodia would be better met by the new lending instrument, PRSC, (Poverty Reduction Support Credit), which provide customized support to country-development, and country-owned reform programs, following extensive consultations among all stakeholders.

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Citation

Cambodia - Structural Adjustment Operation Project (English). Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/401821468769196319/Cambodia-Structural-Adjustment-Operation-Project