Cambodia: Growing results with milled rice

Cambodia: Growing results with milled rice

The EIF in Cambodia is working to deliver pro-poor change on the ground and leverage additional finance for high-impact poverty reduction projects through a nationally owned Trade Sector-Wide Approach (SWAp). The Trade SWAp is a tool used for trade mainstreaming as well as an effective mechanism available to donors for aid delivery. Through the EIF Tier 1 project, projects supporting trade facilitation, tourism and the export of milled rice and high-value silk, as well as cassava and fisheries are being implemented.

Speaking at the launch of Cambodia’s Diagnostic Trade Integration Study Update (DTIS Update) on 18 February 2014, the Executive Director of the Executive Secretariat for the EIF, Mr Ratnakar Adhikari made reference to the two approved Tier 2 projects with a total funding close to US$5.7 million. “These Tier 2 projects aim at supporting five out of ten prioritized sectors in the Trade SWAp Roadmap, which include: high value silk, milled rice, cassava, marine fishery products and tourism,” he said. “The high value silk and rice project called CEDEP I has yielded concrete results in bringing Cambodian silk and rice brands to international markets within one year of its implementation.”

The Cambodia Export Diversification and Expansion Programme I (CEDEP I) is the first Tier 2 project in Cambodia, aiming to strengthen and expand the exports in key sectors including, milled rice and high value silk. CEDEP I also supports hands-on participation of government staff through enhancing their skills in Monitoring and Evaluation. This project supports the Government’s Rice Policy adopted in July 2010 to move up the value chain from paddy rice to high-value milled rice with a target of 1 million metric tonnes (MT) of milled rice exports by 2015.

To advance the Government’s ambition to have 1 million MT of milled rice for export by 2015, the EIF is supporting the rice sector to be more competitive in the global market, with assistance from other development partners such as the European Union, the International Finance Corporation (IFC) and the Agence Française de Développement (AFD). This includes diversifying exports and adding value to paddy rice, which would in turn lead to bigger profits for everyone along the rice chain – and a boost for rice farmers.

An important step was setting up the Federation of Cambodian Rice Exporters in June 2012, alongside a growing focus on strengthening the Government-private sector dialogue with greater market opportunities opening up for rice millers by adopting SPS standards. At the same time, partnering with civil society organizations such as Cambodia Agricultural Development and Research Centre (CEDAC) to mobilize communities has been vital going forward to help link up the sector from fields to ports.

As of 2013, with support from various development partners, the Cambodian rice export industry grew rapidly raising expectations around achieving the Government’s objective of exporting 1 million MT of milled rice by 2015. The increase in rice exports supports the CEDEP I project objective to increase exports of milled rice by 100% from the 2011 baseline volume of approximately 140,000 MT. In 2013, the EIF rice project directly facilitated 44,671 MT of rice exports, which adds up to US$30,520,768 of rice exports, and the export of fragrant rice accounted for more than half of the facilitated exports, higher than the national average.

In growing results in the rice sector, quality has also been fundamental with milling machines taking paddy rice to the next level, increasing profits for farmers and producers. A Rice Production and Milled Rice Export Policy is in place to support the value chain process. Cambodian rice now complies with international quality standards; with major rice export markets including the European Union, Malaysia, Russia and the United States of America.

As a result, Cambodian rice has been showcased in many different international fora. On 19 November 2014 at the Sixth World Rice Conference in Phnom Penh, Cambodia was named as the country with the World's Best Rice for 2014 along with Thailand. This is an accolade that Cambodia has received for the past three years. Previously, during the global rice tasting competition in 2013, Cambodian Premium Fragrant Rice was awarded the ‘World’s Best Rice’ Award at the World Rice Conference (WRC), for the second straight year in a row. The EIF project provided technical support and facilitation to 43 rice exporters from 26 exporting companies to attend the WRC, which was organized by The Rice Trader (TRT) in Hong Kong, China, from 19 to 21 November 2013. These awards have attracted significant media coverage, and in return, the backing of the Cambodian Government to the rice project initiative taken forward by the programme supported by the EU, the EIF and the IFC. Likewise, in 2012, Cambodian Premium Jasmine Rice ‘Phka Malis’ was awarded the ‘World’s Best Rice’ title and was showcased at the Fourth Global Review of Aid for Trade at the WTO in July 2013.

In Cambodia, there are 2.8 million hectares of cultivated land out of which 84% (2.4 million hectares) is used for rice farming, with the rice sector employing over 2.9 million people. The EIF rice project implemented by IFC looks at addressing the existing challenges in the rice sector and supporting the private sector to meet the Government’s target, identifying new major export markets, and in securing export contracts with premium prices for quality rice.