FOREWORD

This is the second report on European Union (EU) Development Co-operation activities in Cambodia, also known as the “EU Blue Book”. It is designed to update the Royal Government of Cambodia, development partners and the wider public on the Official Development Assistance (ODA) of the European Union, (EU Member States and the European Commission), to Cambodia in the years 2004-6. The European Union is a key partner for developing countries. It accounts for 55% of global aid flows, providing in the region of ¤ 30 billion per year. Two thirds of this aid is for development projects, the remaining one third for food aid. The European Union is also an important trading partner for the developing countries, which provide some 40% of total EU imports.

The EU is a key collaborator for Cambodia, providing significant ODA annually. In 2005 this amounted to more than ¤ 130 million or over 156 million US dollars. The estimated total EU ODA disbursements in 2006 are ¤ 128.8 million, or over US$ 151.8 million. The European Union is also the second largest trade partner of Cambodia, absorbing a significant share of its garment exports. Cambodia’s export products also benefit from duty-free and quota-free access to the EU Single Market, through the EU’s Everything But Arms (EBA) initiative.

The “EU Blue Book” thus provides a wealth of quantitative information on the level and composition of the European Union’s ODA in Cambodia. It also reflects the range and diversity of actions supported by the EU. At the same time, the EU is committed to supporting the harmonisation and alignment of ODA, and the EU Member States and the European Commission (EC) seek to ensure that their actions complement each other and those of other donors, while meeting Cambodia’s needs. Finally, the information in the “EU Blue Book” demonstrates clearly the continuing commitment of the European Union to the development of the Kingdom of Cambodia.

We trust that the latest edition, published in English, French and Khmer, will be of use to a large audience, including policy makers, practitioners and researchers in Government and donor institutions, in NGOs and in civil society as a whole. The EC Delegation endeavours to render the “EU Blue Book” as accurate and informative as possible and we welcome any constructive comments and suggestions you may have.

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EU DEVELOPMENT CO-OPERATION IN CAMBODIA

Introduction The European Union (EU) is made up of 25 Member States, committed to working together for peace and prosperity in the world. EU Member States active in Cambodia include Austria, Belgium, the Czech Republic, Denmark, France, Germany, Italy, Luxembourg, the Netherlands, Poland, Spain, Sweden and the UK. In Cambodia, the EU (the European Commission and EU Member States) supports programmes in the areas of education, health, human rights and democratisation, rural development, decentralisation and deconcentration, legal and judicial reform, trade and private sector development.

Belgium supports basic education, teacher training and the provision of health services in three provinces. In addition, it funds rural development projects, targeting rural livelihoods. Denmark supports livelihood improvment for the rural poor though stengthened natural resources management. The support will increasingly be given at local level. Denmark also funds NGO projects on human rights, anti-corruption and activities to develop the Legal and Judicial Reform Strategy. France concentrates on the support to the Rule of Law and good governance (institutional support and training) on the Millenium goals (agriculture and food security, environment and biodiversity protection, health and fight against AIDS) and in cross-cutting issues such as higher education and research, cultural diversity and francophony, civil society structuring. Germany is also a donor to a large variety of projects. In the educational field, it supports vocational and small enterprise-type training. In the health sector, Germany’s focus is on health sector reform and reproductive health. Administrative and trade sector reform as well as rural development are other areas of attention. Italy supports urban and rural development and provides relief to populations at risk. Sweden is mainly supporting the UNICEF Expanded Basic Education Programme, decentralisation of government and NGO projects on human rights. The United Kingdom co-funds health sector projects of the World Bank and the ADB and provides support for HIV and AIDS. The UK also supports a government programme on decentralised governance. Other areas of focus are public financial management and improved rural livelihoods.

Austria, the Czech Republic, Luxembourg, the Netherlands, Poland and Spain provide support for rural energy, market access, NGO activities, humanitarian assistance, cultural cooperation, good governance and human rights, education and human resource development. The European Commission supports food security and integrated rural development, basic education and health, the environment, decentralisation, democratisation and human rights, as well as the Government’s economic and trade reform programme. New actions are in preparation for ‘pro-poor’ economic development through the promotion of Small and Medium-sized Enterprises in the Agro-Industry Sector and continued support to the trade sector to facilitate export growth. Support will also be provided for public financial management reform.

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BELGIUM

Belgian OfficialDevelopment Assistance to Cambodia

The main objective of Belgian ODA to Cambodia is to further establish sustainable human resource development in Cambodia. In particular, Belgian development policy in Cambodia aims at implementing Cambodia’s poverty reduction strategy.

Special attention is paid to national efforts to promote good governance, focusing on key sectors of national priority (i.e. education, health, sustainable development and use of natural resources for navigation in the Mekong River) in the least-assisted geographic areas, targeting the most disadvantaged and vulnerable population.

Belgian supported project«Basic Education and Teacher Training» in Kampong Cham,

Siem Reap andOtdar Meanchey, Cambodia

Belgian supported project «Basic Education and Teacher Training» in Kampong Cham,

Siem Reap and Otdar Meanchey, Cambodia

Areas of supportActual

Disbursement 2004

PlannedDisbursement

2005

Estimated Disbursement

2006

Education ¤ 1,072,189 ¤ 3,719,179 ¤ 3,875,000

Health ¤ 1,832,490 ¤ 1,369,436 ¤ 1,258,000

Water supply & Sanitation ¤ 78,191 ¤ 113,846 ¤ 120,000

Government & Civil Society ¤ 525,473 ¤ 152,937 ¤ 156,000

Other Social services ¤ 73,236 ¤ 33,578 ¤ 0

Transport & Storage ¤ 366,088 ¤ 53,316 ¤ 55,000

Agriculture, Forestry & Fishing ¤ 60,519 ¤ 75,524 ¤ 76,000

Environmental protection ¤ 79,303 ¤ 0 ¤ 0

Women in development ¤ 76,804 ¤ 46,750 ¤ 40,000

Urban and rural development ¤ 87,950 ¤ 108,452 ¤ 110,000

Programme assistance ¤ 151,638 ¤ 83,368 ¤ 80,000

Support to NGOs ¤ 35,723 ¤ 0 ¤ 0

TOTAL ¤ 4,439,604 ¤ 5,756,386 ¤ 5,770,000

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CZECH REPUBLIC

Czech – Cambodia Development Co-operation

The Czech Republic’s co-operation activities in Cambodia focus on humanitarian assistance and nuclear analysis of building structures. Czech ODA to Cambodia amounts, as of 2004-2006, to ¤ 218,000. In addition to the ODA, several Czech NGOs (ADRA Czech Republic, Stonožka-Centipede) provide assistance to Cambodia (especially to HIV/AIDS related projects).

In the 60s and 80s Cambodia was among the most important Asian partners of Czechoslovakia. Assistance to development was provided mainly through supplies such as transport equipment, building machines, textile and shoemaking machines, sugar mills, diesel generators, hydro and thermal power engineering equipment, tyre making plant. The construction of the thermal power plant Chak Angré in Phnom Penh is the biggest project financed by Czechoslovakia. Moreover, Czechoslovak medical experts were provided to some Cambodian hospitals.

Another main form of development assistance of former Czechoslovakia was the government scholarship programme for the students of third world countries. During the 60s, 70s and 80s many Cambodian students studied at Czech high schools and universities. The government scholarship programme successfully continues today (scholarships of the Ministry of Education, Youth and Sports in support of foreign nationals studying at public higher education institutions in the Czech Republic based on international agreements binding for the Czech Republic or within the Czech Republic Foreign Aid Programme). Five Cambodian students are at present studying in the Czech Republic.

Eminent personalities of Cambodian society, such as His Majesty King Norodom Sihamoni (who studied in Prague between 1962 and 1975), can speak Czech and maintain contacts with the Czech Republic. This provides a sound basis for cultural co-operation. The Czech Republic intends to deepen the cultural dimension of Czech-Cambodian co-operation. To commemorate the 50th anniversary of diplomatic relations between the Czech Republic and Cambodia in 2006, several cultural events (film, exhibitions, book launches, preservation of monuments) are planned in the near future.

The ODA given to Cambodia by the CZECH Republic (2004-06)

Areas of support

ActualDisbursement

2004

PlannedDisbursement

2005

EstimatedDisbursement

2006

Humanitarian assistancein Takeo province

¤ 20,000 ¤ 100,000 ¤ -

Nuclear analysis of building structures in Angkor

¤ - ¤ 8,000 ¤ 90,000

TOTAL ¤ 20,000 ¤ 108,000 ¤ 90,000

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DENMARK

Danish and Cambodia Development Co-operation

Danida’s main objective in its development policy is poverty reduction subject to cross-cutting issues such as good governance, anti-corruption, human rights, gender equality and environment.

In 1997, the Royal Government of Cambodia and the Danish Government signed a memorandum of understanding on assistance to the natural resources and environment sector in Cambodia. A cooperation agreement on a Natural Resources and Environment (NRE) programme was signed in 2001 with a commitment frame of 200 million Danish Kroner. This NRE programme has been implemented in the period 2001-2005 with the overall development objective:

to assist in sustainable management and equitable use of natural resources and protection of the environment to improve the livelihoods of poor people and support balanced socio-economic development.

The NRE programme has two components: Capacity Development, Environmental Education and Training Commune and Community Based Natural Resource ManagementThe programme covers 16 of Cambodia’s 24 provinces, including all four coastal provinces, and 311 communes or approximately 20 per cent of the total number of communes in Cambodia. A new joint Danida/Dfid Natural Resource Management and Livelihoods (NRML) Programme to be implemented from 2006-2010 is currently being planned. The development objective of this programme is:

to secure livelihood improvements for the rural poor through strengthened NRE management at local level, strengthened land and other resource rights, pro-poor business development and support to civil society in rural areas.

The planned Danida commitments to the new programme amount to 220 million Danish Kroner subject to approval by the Danish parliament. The new programme will eventually cover 21 provinces and 1000 communes.Danida also implements a Human Rights and Democracy Programme which provides support to both NGOs and government institutions. The programme supports activities advocating civil and political rights, fighting corruption and increasing transparency and accountability within the public administration. Furthermore, a number of Danish NGOs implement Danida funded projects in Cambodia in the areas of health, legal and judicial reform and agricultural development.

Areas of supportActual

Disbursement2004

PlannedDisbursement

2005

EstimatedDisbursement

2006

NRE Programme ¤ 3,985,892.55 ¤ 5,639,279.20 ¤ 8,492,438.06

Support to NGOs ¤ 3,464,266.96 ¤ 4,089,348.92 ¤ 3,941,864.21

TOTAL ¤ 7,450,159.52 ¤ 9,728,628.12 ¤ 12,434,302.26

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FRANCE

French Co-operation in Cambodia

In addition to its multilateral contributions, French cooperation is channelled to Cambodia through two operators: the Direction générale de la coopération internationale et du développement (General Directorate of International Cooperation and Development – DGCID) under the Ministry of Foreign Affairs, as well as the Agence Française de Développement (AFD). These two operators work with the Royal Government of Cambodia to implement the priorities set in the Partnership Framework Document 2006–2010:

1. Support to the rule of law and good governance. Firstly by strengthening training for management level staff in the judiciary and in government, including judges and prosecutors, court clerks, lawyers, police officers and civil servants, and secondly by creating conditions conducive to the enforcement of the rule of law through the processes of codification, legislation, law publication, public finance reform and training for commercial negotiations.

2. Targeting the Millennium Goals enables increased support to three priority sectors:- Agriculture and food security, with the aim

of meeting food needs, contributing to the integrated development of agriculture through water management, land security and local community associations and strengthening opportunities for diversification and export, with special focus on the rubber sector;

- Protection of the environment and biodiversity, including the water resources of the Mekong basin and the forests of the Cardamom Mountains;

- Health and AIDS prevention, supported by a comprehensive approach to the Cambodian health system with the aim of improving the access, the funding and the quality of care offered,

3. Cross-sector interventions reinforce these directions by promoting:

- Higher education and research, in order to restore top level management in medical sciences, economics, judiciary and engineering;

- Promotion of cultural diversity and Francophony through actions to safeguard cultural heritage, publications and exchanges, as well as to promote the teaching of French;

- Structuring of civil society by direct support to local authorities and NGOs.

France also provides expertise in thekey sectors of urban development,tourism and water treatment.

Moneys disbursed 2004 ¤ 18,5 millions

Moneys disbursed 2005(estimated)

¤ 21,5 millions

Estimate for 2006, based on commitments ¤ 22 millions

Phnom Penh’s urban fabric, taken from PP master plan 2020

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GERMANY

Germany - Cambodia Development Co-operation

The Kingdom of Cambodia is a focal country of German development co-operation. Main areas of assistance are health, rural development and the promotion of private enterprises. Under the cross-cutting issue of good governance, Germany funds projects in the fields of decentralisation, land management, gender and capacity building in public institutions. So far, Germany has committed almost ¤ 163 million for bilateral co-operation.

In the pursuit of the Millennium Development Goals, Germany places high importance on poverty reduction. Therefore, future activities in the promotion of the private sector will focus even more strongly on rural areas.

The German Government welcomes the planned Khmer Rouge Tribunal. The Tribunal will not only deal with crimes committed during that period but also help to strengthen the rule of law and foster the legal culture in Cambodia. In this respect, Germany has contributed ¤ 2.5 million to the United Nations’ budget for the Tribunal.

Germany is also actively involved in the conservation and restoration of the temples of Angkor Wat and Preah Koh through the German Apsara Conservation Project (GACP) as well as in humanitarian de-mining in Siem Reap and Oddar Meanchey provinces.

Development aid is mainly carried out by the German Technical Co-operation (GTZ), KfW Entwicklungsbank and the German Development Service (DED). In addition the German Embassy in Phnom Penh runs a Small Grants Programme which supports mostly rural projects.

Areas of supportActual

Disbursement 2004

Planned Disbursement

2005

Estimated Disbursement

2006

Education ¤ 220,000 ¤ 70,000

Health ¤ 1,003,000 ¤ 1,260,000

Popul. & Rep. Health ¤ 1,470,000 ¤ 2,000,000

Government ¤ 1,110,000 ¤ 1,280,000

Other Social services ¤ 110,000 ¤ 60,000

Transport ¤ 1,318,500 ¤ 1,200,000

Private Sector ¤ 1,005,000 ¤ 1,650,000

Agric. & Forestry ¤ 220,000 ¤ 20,000

Women ¤ 520,000 ¤ 540,000

Urban/Rural Dev. ¤ 4,050,000 ¤ 3,490,000

Food/Aid ¤ 400,000 ¤ 400,00

Support to NGOs ¤ 3, 250,000 ¤ 3,300,000

TOTAL ¤ 14,676,500 ¤ 15,270,000 ¤ 14,050,000

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ITALY

Italy – Cambodia Development Co-operation

Italian cooperation activities in Cambodia have been directed to provide assistance to Cambodian people and Cambodian Institutions on some of the most relevant issues affecting the country. The specific activities undertaken focus mostly on two main areas: rural development and relief to populations at risk, especially with specific attention to the fight against trafficking and sexual exploitation of minors.

The aid strategy for the next years relies on previously launched projects which have shown good results both in promoting respect of human rights and in assisting and improving rural development.

Furthermore, the Italian Government has recently started a new project managed by IOM that aims to improve the legal and political framework in order to simplify the monitoring and investigation in cases of trafficking of women and children. This project strengthens the efforts made by the Italian Government to improve the living conditions of vulnerable children.

The Italian Government has already earmarked ¤ 3,713,979.55 for a rural integrated programme in Battambang province managed by FAO that should be implemented shortly and last for three years.

UNICEF Regional Child Protection Programme is likely to be refinanced in the next years.

Italian funds are channeled mainly through multilateral agencies but some particular projects are implemented through NGOs.

*Total funding for this programme is 3,713,979.55 amounts refers to FAO project and will be spread over three years.

Areas of supportActual

disbursement 2004

Planned disbursement

2005

Estimated Disbursement

2006

Education ¤ 133,468 ¤ 133,468

Government and civil society ¤ 161,921 ¤ 371,104 ¤ 271,104

Other social services ¤ 113,500

Agriculture, forestry and fishing ¤ 25,000

Urban and Rural development ¤ 1,372,132.96* ¤1,171,061.36*

TOTAL ¤ 433,889 ¤ 1,876,704.96 ¤ 1,442,165.36

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NETHERLANDS

Dutch DevelopmentCo-operation to Cambodia

Since 1998 The Netherlands has provided development assistance to Cambodia worth ¤ 2 – ¤ 2.5 million per year. Dutch development co-operation has been channelled mainly through multilateral organisations and NGOs. In 2004 Dutch development co-operation policy underwent a review that saw the selection and downsizing of the number of partner countries. The new focus is geared towards Africa. As a consequence, Cambodia is no longer a priority for assistance.

Nevertheless, Dutch support will continue for the Khmer Rouge Tribunal – for the preparatory phase as well as the actual Tribunal1 – and through a Small Projects Programme (PKP). This programme supports the implementation of small initiatives focused on direct or indirect poverty reduction with a maximum duration of one year. The budget of this programme is ¤ 100,000 in 2006 and ¤ 75,000 a year from 2007 onwards.

Until 2004 the Dutch support was geared towards good governance and human rights. 2004 and 2005 have been used to implement an exit-strategy.

Areas of support

Actual disbursement

2004

Planned disbursement

2005

Estimated Disbursement

2006

Good governance andhuman rights

¤ 1,359,599.00 ¤ 930,000.00 ¤ 300,000.00

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1The Netherlands committed ¤1.3 million to the Khmer Rouge Tribunal through the UN.

POLAND

Poland - Cambodia Development Co-operation

The Republic of Poland follows its long tradition of friendly relations and development co-operation with the Kingdom of Cambodia. The main area of the assistance is human resources development, culture and the education system. About 100 Cambodian students have graduated from Polish universities thanks to the scholarships granted by the Government of Poland.

From 1989-1993 a Polish mission of restorers was actively involved in restoration and conservation of the temples of Angkor Wat and the murals of the Silver Pagoda Gallery in Phnom Penh. Poland is ready to continue the work and efforts to save Cambodian historical monuments by conversion of the Cambodian debt to Poland for this purpose.

In 2001 and 2003 Poland contributed ¤ 20,000 of its ODA to the construction of two new school-buildings in Chey Mungkul Primary School, Kean Svay District, Kandal Province, and ¤ 2,000 to its students’ educational aid.

In 2005 Poland will provide ¤ 14,500 for the construction of an additional school building, water supply and sanitation in Chey Mungkul Primary School. Estimated disbursement for 2006 amounts to ¤ 20,000.

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SWEDEN

Sweden - Cambodia Development Co-operation

The overall objective of Swedish development cooperation in the present strategy period is to support Cambodia’s own anti-poverty efforts (NPRS) according to The Millennium Development Goals. The specific objectives of Swedish development co-operation in the period 2002-2006 are:

• To promote opportunities for poor men, women and children in rural areas to influence and improve their living conditions.

• To promote conditions conducive to good governance, with specific emphasis on the development of democracy and respect for human rights.

In order to respond to the above-mentioned objectives, three areas of cooperation have been identified for the strategy period namely (i) combating poverty in rural areas, (ii) education and (iii) democratic governance. All these areas represent an extension of established cooperation and are judged to have clear direct and indirect links to poverty reduction. Sweden also supports Mine Clearance, until the end of 2005.

In addition, gender balance, the environment, democracy and human rights and HIV/Aids will continue to be integrated into these main areas as cross-cutting issues. Cooperation and co-financing with the UN, other multilateral organisations and bilateral partners will remain the principal form used for Swedish cooperation. Aid will also continue to be channelled through NGOs, as Swedish aid is also used to support civil society.

Areas of support

Actual Disbursement

2003

Actual Disbursement

2004

Planned Disbursement

2005

Estimated Disbursement

2006

Democratic governance and HR

¤ 3,621,861 ¤ 3,633,960 ¤ 3,690,870 ¤ 3,494,105

Social sectors ¤ 2,717,641 ¤ 5,501,438 ¤ 1,956,522 ¤ 5,466,238

Natural resourcesmanagement

¤ 5,446,212 ¤ 6,969,027 ¤ 4,802,500 ¤ 7,877,814

Humanitarian assistance:Including demining ¤ 1,736,688 ¤ 1,327,434 ¤ 467,391 ¤ 0

Economic reforms ¤ 1,731,602 ¤ 0 ¤ 0 ¤ 4,287,245

Others ¤ 294,048 ¤ 565,265 ¤ 610,870 ¤ 599,143

TOTAL ¤ 15,548,052 ¤ 17,997,124 ¤ 11,528,152 ¤ 21,724,544

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OTHER EU MEMBER STATES

In addition to the ODA provided by the countries listed above, other European Union Member States such as Austria, Luxemburg and Spain contribute to the development of Cambodia, although they do not maintain a permanent presence in the country.

Austria

For its development assistance, Austria follows the principle of geographic and thematic concentration. As Cambodia does not count among the programme countries there are limited opportunities for Austrian development support. However, opportunities include the funding of fellowships for a limited number of scientists and researchers. Another evolves around the funding of Austrian NGO projects in close cooperation with local partners.

In the past Austria has contributed to demining activities and is now financing two projects that are implemented by UNIDO: “Rural Energy for Productive Uses”, (¤ 767,000) and “Market Access Support for Cambodia through the Strengthening of Capacities related to metrology, testing and conformity” (¤ 487,000).

Luxembourg

Luxembourg provides funding for NGO projects in Cambodia with a Handicap International initiative receiving some ¤ 136,753.6 in 2004.

Spain

Spanish co-operation with Cambodia has only recently started on a regular basis (2005). It focuses on the development of Cambodian human resources and the fight against human trafficking, with special attention to women.

Three scholarships have been granted to Cambodian citizens to attend seminars on “Building up educational programmes to support tourism development”, “Hotel management today” and “Export promotion policies”. In each case, seminars have been chosen because of their relevance to the development of the country.

The fight against human trafficking has been supported through aid to Cambodian NGO AFESIP (Agir pur les femmes en situation precaire). This NGO receives contributions from the Spanish NGO Anesvad, which is partly funded by the Spanish Government.

Spanish contributions to AFESIP in 2005 comprised:

• Identification and repatriation of victims of sex trafficking to their respective countries (Cambodia, Lao PDR and Vietnam). Contribution: US$ 112,931

• Sub-Mekong regional project: HIV prevention for sex-workers (Cambodia , Vietnam, and Lao PDR). Contribution: ¤ 45,000.

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EUROPEAN COMMISSION DIRECTORATE-GENERAL FOR HUMANITARIAN AID (ECHO)

Humanitarian aid

The European Commission (EC) is one of the largest donors of humanitarian aid to Cambodia, and has provided more than ¤ 65 million through its Humanitarian Aid department, ECHO, since 1993. In the 1990ies, the bulk of the European Commission’s humanitarian assistance helped returning refugees and those displaced within the country to restore their livelihoods after 30 years of conflict and violence. For example, the Commission financed de-mining activities, the construction of wells, latrines and the development of basic health services in isolated or war torn areas. Medicines and basic non-food items such as household items and hygiene products were also provided.

Once the humanitarian situation had stabilised in some provinces, ECHO has facilitated since 2000 the stepping in of development progammes and began to reduce its overall funding. The European Commission continues to provide humanitarian aid throughout 2006 in remoter areas of the country which receive no or only limited development aid. Under the leitmotif of “child survival”, humanitarian assistance focuses on helping to reduce the infant and child mortality rate (one of the highest in the region) and to improve living conditions for the most vulnerable groups. Funds are provided to improve health care services - with particular emphasis on infants, children, pregnant and lactating women - as well as for water and sanitation projects. The funds have for example allowed the vaccination of 94,000 children against measles and other preventable diseases and the provision of vitamin A supplements to 450,000 children throughout 2003 and 2004.

To alleviate the impact of natural disasters, such as Cambodia’s recurring droughts and floods, the Commission has provided an additional ¤ 3.7 million since 1998 for disaster preparedness and prevention activities through its DIPECHO programme.

Despite the phasing out of its humanitarian aid, the European Commission will continuously monitor the humanitarian situation in Cambodia so as to provide assistance whenever the need arises.

* The amounts given for DIPECHO represent allocation for a 2-year programming period. The commitments for the period 2002-2004 amounted to ¤ 748,750.

Sectoral DistributionActual

Disbursement 2004

Planned Disbursement

2005

Estimated Disbursement

2006

Emergency assistance (ECHO) ¤ 3,805,675 ¤ 3,496,433 ¤ 2,000,000

Disaster preparedness (DIPECHO) * ¤ 1,245,000 *

TOTAL ¤ 3,805,675 ¤ 4,741,433 ¤ 2,000,000 *

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