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Weak Institutions Hurting Cambodia’s Growth, Analyst Says

A Cambodian student tries to throw the form of hand-delivered crib notes to help his friends while they are examining inside the Phnom Penh's school, file photo.

Cambodia has undergone some reform to improve its institutions, but analysts say a lack of leadership is preventing deeper change. Strong political institutions are required for continued economic growth, but the capacity of Cambodia’s state institutions remains weak.

“Corruption and nepotism are limiting the state’s capacity building,” says Chheang Vannarith, a lecturer at the University of Leeds, in the United Kingdom.

The country has made some progress. In 2014, the Ministry of Education undertook an active campaign to stop cheating, resulting in lower passing rate to 25.7 percent from 86 percent in 2013. And the Ministry of Commerce has set up an online registration process for investor that prevents some corruption.

But overall, the capacity of state institutions is limited, Chheang Vannarith said.

Dyna Heng, a Cambodian economist based in Washington, said Cambodia lacks technocrats in key institutions, which is a major constraint. “Cambodia has strong policies toward state-building, but the problem lies in a lack of effective implementation of those policies,” he said.

Now that Cambodia is undergoing reforms, building a merit-based system and accountability is critical, he said.

“If a person who has the ability and is suitable to work for a particular institution, he or she should be hired,” he said. That will help improve the state’s capacity to provide effective public services.

But such state-building can’t be done without strong leadership, Chheang Vannarith said. “Top leaders must have a genuine political will toward reform.”