UN wants accelerated farm aid to support Cambodia

PHNOM PENH, The United Nations asked donors on Thursday to speed up farm aid to help Cambodia increase rice exports, at a time when its important garment sector and tourism are suffering because of the global financial crisis.

Douglas Broderick, resident representative of the United Nations Development Programme (UNDP), told an economic forum that Cambodia had great potential in terms of its location in Southeast Asia but required financial support.

"A fertile agricultural sector produces white gold to set Cambodia apart and propel its economic growth," Broderick told the forum, referring to rice.

Cambodian officials said the government had lent private millers $30 million to buy rice from farmers to ensure domestic supplies but was seeking another $300 million to increase capacity for collecting, stocking and processing the crop.

Aid donors including the World Bank and Asian Development Bank have pledged around $950 million in aid this year, and Prime Minister Hun Sen urged them to accelerate disbursements to help agriculture, on which 85 percent of Cambodia's 14 million people depend.

"Agriculture is important for sustaining growth and reducing poverty," Hun Sen told the forum.

Cambodia's total rice production is put at 7 million tonnes in 2008/09 (June/Feb) after 6.7 million tonnes in the previous harvest, and Deputy Agriculture Minister Chan Tong Eves told Reuters there was a surplus of 2 million tonnes for export.

According to the U.S. Department of Agriculture, the country shipped 450,000 tonnes of rice in 2007, when it was the ninth-biggest exporter in the world.

The UNDP is facilitating Cambodia's rice exports to a few countries in Africa, including Senegal and Guinea.

Hun Sen said the garment sector, Cambodia's biggest export earner, and tourism had been hit by the global slowdown, and that economic growth could slip to 6 percent this year from an estimated 7 percent in 2008.

Cambodia received 2 million tourists last year and garment exports totalled about $2.78 billion, with a drop of up to 10 percent expected for 2009, industry officials said. (Reporting by Ek Madra; Editing by Alan Raybould)