Summary of Day 1: Agrarian Structure Seminar - World...

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Summary of Day 1: Agrarian Structure

Seminar

Hang Chuon Naron, Secretary-General, Ministry of Economy and Finance, Kingdom of Cambodia

28 June 2005

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PROF. HAYAMI, Keynote Speaker

Agrarian system consists of agrarian Structure and institutions;Agrarian structure: who own farm lands; who use farm lands; small family farms vs. large plantations;Agrarian institutions: rules for land and labor, laws and customs; property rights and contracts;Two models: plantations link up with exporters directly, while family farms through local trade network.

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Global demand is in large quantity and of standardized quality, while local supply may be diverse;Therefore, local products should be processed and assembled to meet global demand through bulking process by local trade network.Rice, corn, soy bean are not perishable; For flower and highly perishable marketing is not easy (estate firm and plantation);

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PROF. HAYAMI, Keynote SpeakerEstates (plantations, cooperatives): some product needs coordination between production and processing, as well as marketing for global demand; only a few crops rubber, banana, coffee, palm oil, require tight command; monoculture and soil degradation; pest, social costs and conflicts, but ability to build infrastructures;

Family farms can be efficient if:Technology; market and community’s capacity;Makes local trade network efficient;Government should provide infrastructures, agricultural research and extension.

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H.E. LU LAY SRENG, Minister for Rural Development, Opening Remarks

Rural development is key to improving the living standards of the population to reach MDGs;Village Development Committees at the grassroots level ensure participation of the population in decision making in conjunction with Commune Councils in managing projects-roads, schools, sanitation, food security;Decentralization, rural infrastructures, processing, marketing services, land management, environmental sustainability.The importance of trade in poverty reduction, opportunities and risks in trade liberalization.

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Plenary session 1: Agrarian structure: The Role of Land Policies

Dr. Gershon Feder, Research Manager, WBProperty rights evolve with population and trade; sources of conflicts and has implications on economic performance;Market emerges only if rights defined, public enforcement reduces transaction costs;Characteristics of land markets: rentals, sales, imperfections of the markets.Land reform and distribution: positive social and productivity impact in Asia;Role of government in providing tenure security: clear legislation, efficient administration, effective dispute resolution, land use zoning, risk of conces.

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Dr. Ou Vuddy, DDG, MLMUPCLand policy evolves with political, cultural and customs development;Since 1987, the introduction of private ownership for habitation, use rights for cultivated land (5 ha), and concessions, but enforcement of property rights remained a problem- Tragedy of the Commons;Weak administration led to insecurity of land tenure and public land grabbing; “Freedom in the context of the lack of institutions”; New Land Law in 2001, but lacks IRs; Land policy statement and sub-decrees;Family farms are efficient in Vietnam and Thailand

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Oknha MONG RITHY

In 1996, Palm oil plantations in 11,000 ha, of which 4,000 ha planted; 16 million $ invested;Processing capacity 5 tons per hour;Land disputes between MRTG and former loggers in 2005;Unclearly defined property rights and the lack of enforcement do not promote economic performance and have the potential of damaging private investments in agribusiness.

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Dr. YANG SAING KOMA, Director, (CDAC)Family agriculture is based on land; 75-80% of 2.2 million families are small rice farmers;Family farms account for 60-70% of active workforce, the core of social-economic and political stability;Competitiveness of ecological-based family farms in organic products – reduce imports and increase exports;System of Rice Intensification (SRI) produce surplus of good quality rice;Research and extension, development of farmer associations, land allocations to farmers.

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Plenary session 2: Implications of WTO on Agriculture and Farmers

PROF. HAYAMI, Keynote SpeakerThird alternatives: contract farming. Small holders can link up with agri-business (technical guidance, marketing and processing) to boost products and exports through an efficient system.Contract farming used to reduce supervision;Mutual trust is not easy to established;There is no single form of contract farming:

Teams of 10 to 15 to do work in the plantations;Plantations reduce working incentives, leading to introduction of performance- based parcel system;

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Traditional peasant marketing system is efficient for traditional subsistence crops = storage with small marketable surplus, e.g. rice, corn, soybean etc.Inefficient for new crops of rising demand, i.e. flower, fruits, vegetable.Inter-village collector of vegetable marketing reflects some sort of contract farming;

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Policy issues:Make market competitive;Government as mediator;Market information;Protection of property rights & contracts;Hard infrastructure and environment.

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H.E. SOK SIPHANA, Sec State, CommerceNew sources of economic growth focusing on agricultureBackward linkage is critical for growth: cotton grower in Kompong Cham;Silk promotion;SRI Organic Rice – 4-5 ton per ha;MFN Market access to 147; AISP, Early Harvest, EBASupport system: supplier; processing, packaging, transportation, distribution and consumer;

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Mr. Mudbhary, Sr. Policy Officer, FAO Regional Office

New markets and new rules; trade is a key link of globalization;Farm need to compete to survive;Quality and safety standards of importers;Public goods – policies, infrastructure, support services including market info., research, testing and certification – reducing transaction costs, HRD and removing credit constraints are crucial;Contract farming and cooperatives.

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Dr. Vuthy Choun, Leaf Manager, British American Tobacco (BAT), Cambodia

Leaf extension services;Farmer’s selection, sharing best practices;Yield (160%) and quality improvement vs. prices;Integrated crop management;Domestic procurement system;Interest-free loan supply;

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Ms. Mao Samvutheary, President, Cambodian Independent Farmers Association

Supporting members to secure seeds, financing, marketing and irrigations;Expanding domestic markets;Supporting small farms and domestic products;Quality improvement.

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Group discussion and team work on Agrarian structure and trade integration

The Role of Land Policies:The constraints to improving land markets:

Land market for both sale and rentals (concessions): security of tenancy is not fully ensured;Speculation of real estate prevents productive use of land;Inadequate enforcement of Law on Land Use and the Lack of the Master Plan; Incomplete legal framework;Overlapping responsibilities;Small land holding;Lack of technology;

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The Role of Land Policies:5 most important things to improve land market in Cambodia:

Land registration and mechanism for land dispute resolution;Improving land valuation;Land use zoning;Social land concession with integrated rural development, including low-interest loans, improved infrastructures and promotion of domestic products;Introduction of capital gain tax;Enforcement of formal transactions;

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The Role of Land Policies:Who has to be involved?:

Private sector (real estate companies, insurance companies, banks);Public sector (MEF, MOI, MLMUPC, MIME, MOWRAM, MOC, MAFF, MRD etc.);

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Trade and Agriculture and Farmers:Opportunities and threats faced by Cambodian farmers

under free trade:Opportunity

Expanding domestic markets and increase in exports, more investment opportunities, support from government, access to world markets, increase quantity, diversification, new technology transfer, skill improvement, diversification and added values.

ThreatInadequate land for products, natural disasters, technology, inadequate irrigations, market information, lack of farmer association, fierce competition and increase in imports.

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Trade and Agriculture and Farmers:5 most important things to do to compete in agricultural

exports:Quality improvement;Trade facilitation;Agricultural services and extension (research and development);Financial services;Boost trusts between producers and traders;Strengthening farmer’s institutions;Improved technology

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Trade and Agriculture and Farmers:Who has to be involved?:

Farmers, Government, NGOs, Private sector, Donors.

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THANK YOU !!!

Summary of Day 1: Agrarian Structure Seminar - World...

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