Further Steps to Improve Cambodian Railway Rehabilitation Resettlement

ADB,ADB Bank, Mar. 20 2013

MANILA, PHILIPPINES – A report commissioned by the Asian Development Bank (ADB) to help improve resettlement implementation and monitoring for the Cambodia railway rehabilitation project recommends measures to limit indebtedness amongst resettlers; multiply their opportunities to restore their incomes; and steps to improve the independence of monitoring and follow-up processes.

The report is one element of a series of efforts designed to improve resettlement under the project. Other initiatives to improve lives and livelihoods include a social safety net fund that offers grants to resettled vulnerable households in cases of crisis or emergency and an expanded income restoration program which allows resettled households to access low-interest loans and grants. Self-Help Groups have also been established to support small-scale community development projects that improve facilities and services available to resettled households. Civil society organizations continue to monitor progress of these initiatives.

The report proposes four clusters of main recommendations focusing on eliminating resettlers’ risk of losing their house-plots; multiplying resettlers’ opportunities to jobs and other options for income recovery; resolving accumulated economic legacy issues; and restructuring the organization of the independent monitoring and follow-up process. A link to the recommendations can be found here: http://www.adb.org/projects/documents/recommendations-consultant-report-monitoring-population-resettlement-tacr

Although the full report contains numerous references to internal information and communications comprising ADB’s deliberative and decision-making processes, ADB believes that sharing the recommendations of the report will benefit the broader public interest and further the purposes of transparency and public confidence in identifying problems and working constructively toward their resolution.

ADB and AusAID are working closely with the Cambodian government to reduce indebtedness amongst resettled households. Discussions with moneylenders have led to some lenders reducing their interest rates while lengthening repayment terms. Microfinance organizations and a financial expert have also been consulted to identify means of protecting resettled families from future, unsustainable debt loads.

AusAID, in parallel efforts, has engaged the Credit Union Foundation Australia to strengthen financial literacy among affected households. This comprehensive, 18-month financial literacy training is offered at all five relocation sites and will provide financial counseling for 1,000 resettled families to help them better manage their income and get on a more solid financial footing. The training focuses on building skills in managing money, budgeting for household expenses, investing in businesses, repaying debts, and preparing short- and long-term financial goals.

The project is rehabilitating 600 kilometers of Cambodia’s dilapidated rail tracks, and reconstructing an additional 48 kilometers of missing rail link connecting Cambodia to Thailand. Most of the rehabilitated rail line will open for traffic during 2013, but part is already operational.

A properly functioning railway system in Cambodia will reduce transport costs, enable local industries (such as the garment industry) to become more competitive in international and local markets, create new employment opportunities, and help reduce the number of heavy vehicles on Cambodia’s roads, leading to less pollution and fewer traffic accidents.

ADB has provided loans totaling $84 million, with AusAID providing another $22.5 million in grant assistance for the $142.6 million project.