Now I am a reasonable man, quiet, calm, even tempered, people have even gone as far in the past as to describe me as tranquil.
Yet an incident occurred the other day that really pissed me off.
In fact, it annoyed me so much I was close to slapping a woman. I was enjoying an early spot of luncheon with two friends. Now these two particular friends are Khmer and they are also female. They are family of a very good Khmer friend of mine.
They do not work in bars; they are in town staying with my friend’s family while they look at different schools/universities here for them to study at.
That is to say, they are normal teenage Khmer good girls. My friend had to go and meet someone about a business they are thinking about buying, so I said that I would take the girls for lunch, they wanted to try ‘Western Food’ so I took them to a well know ex-pat restaurant here.
Well despite the girls having watched a million hours of HBO, AXN and STAR Movies, they were not sure what they wanted to try at the restaurant; which resulted in much hilarity ensuing from my pigeon Khmer, their pigeon English and my somewhat limited miming skills.
But we eventually got an order placed after about 10 or 15 minutes of such joviality. After the waitress had gone, we were still giggling a fair bit when the 20 stone, po-faced, battle ax, war dragon, pig ugly, militant skank, mound of the hound of the Baskerville’s, bitch sat at the table opposite us remarked, rather loudly, to her dining companion.
‘It is bad enough men like him are here, but do they have to show off those sort of girls in public’
Well, to be honest, it took me a second or two to work out who and what she was talking about.
‘EXCUSE ME, did you just call my friends whores???’
I should have bitch slapped the stupid fat cowup and down the river front
Grrrr
Thursday, November 04, 2004
Tuesday, November 02, 2004
Top business gripe in Cambodia - Bribes
Top business gripe in Cambodia - Bribes
"unofficial payments" in polite-speak -forced on business ranked as the top complaint by industry leaders in a World Bank report on Cambodia's investment climate released on Thursday, August 12.The report, Cambodia Seizing the Global Opportunity, found "unofficial payments" as a share of total business revenue were twice as high as in Bangladesh and by far the highest among countries benchmarked in the report.Bangladesh is ranked as the most corrupt of all the countries assessed annually by Transparency International - which does not yet assess Cambodia.
Other gripes included minimum capital requirements and the costs of incorporating a business, which are among the highest in the world in terms of relative income levels.It noted that Thailand, Nepal, Uganda and Vietnam have no minimal capital requirements for establishing a business.
Adding to the burden were red tape and a lack of institutions capable of absorbing risk, which has resulted in rural Cambodian firms holding the world's highest inventory stocks when measured against sales.Clearing an import shipment could require the completion of 45 separate documents."As a consequence of these impediments, labour productivity of Cambodian firms surveyed is 62 percent below China and 10 percent below Bangladesh. "Today's report notes that as a consequence of these perceptions, foreign direct investment has fallen consistently since 1999."
Commerce minister Cham Prasidh said the report had exposed the problems, constraints and challenges of business operating in Cambodia.
"Now that we know the symptoms and the disease, we know what is needed is the political will to take the necessary actions and implement the reform program to help business survive, increase competitiveness, and prosper," he said.
Economic and Finance Minister Keat Chhon vowed to implement reforms aimed at improving Cambodia's investment climate and delivering a public and financial management system of international standards by 2015. He said this would be achieved through a raft of policies designed to bolster public and financial management announced by Prime Minister Hun Sen at his first cabinet meeting for the new government on July 16.
"The government agrees that we must do more to improve the investment climate by tackling the high cost of business, bureaucratic red tape and corruption," he said. "With respect to unofficial costs we need to work on both fronts, to reduce the costs of business and to increase tax revenue."
Yeah, Right. We believe that.
"unofficial payments" in polite-speak -forced on business ranked as the top complaint by industry leaders in a World Bank report on Cambodia's investment climate released on Thursday, August 12.The report, Cambodia Seizing the Global Opportunity, found "unofficial payments" as a share of total business revenue were twice as high as in Bangladesh and by far the highest among countries benchmarked in the report.Bangladesh is ranked as the most corrupt of all the countries assessed annually by Transparency International - which does not yet assess Cambodia.
Other gripes included minimum capital requirements and the costs of incorporating a business, which are among the highest in the world in terms of relative income levels.It noted that Thailand, Nepal, Uganda and Vietnam have no minimal capital requirements for establishing a business.
Adding to the burden were red tape and a lack of institutions capable of absorbing risk, which has resulted in rural Cambodian firms holding the world's highest inventory stocks when measured against sales.Clearing an import shipment could require the completion of 45 separate documents."As a consequence of these impediments, labour productivity of Cambodian firms surveyed is 62 percent below China and 10 percent below Bangladesh. "Today's report notes that as a consequence of these perceptions, foreign direct investment has fallen consistently since 1999."
Commerce minister Cham Prasidh said the report had exposed the problems, constraints and challenges of business operating in Cambodia.
"Now that we know the symptoms and the disease, we know what is needed is the political will to take the necessary actions and implement the reform program to help business survive, increase competitiveness, and prosper," he said.
Economic and Finance Minister Keat Chhon vowed to implement reforms aimed at improving Cambodia's investment climate and delivering a public and financial management system of international standards by 2015. He said this would be achieved through a raft of policies designed to bolster public and financial management announced by Prime Minister Hun Sen at his first cabinet meeting for the new government on July 16.
"The government agrees that we must do more to improve the investment climate by tackling the high cost of business, bureaucratic red tape and corruption," he said. "With respect to unofficial costs we need to work on both fronts, to reduce the costs of business and to increase tax revenue."
Yeah, Right. We believe that.
Monday, November 01, 2004
The Tonle Sap great lake
Cambodia's great lake, the Tonle Sap lake, expands and shrinks with the seasons. As it moves, so do its floating villages.
I meet some of the waterborne nomads
A signpost on the road leading to Kompong Luong advises that the village is "maximum 7km, minimum 2km" away. Kompong Luong, a collection of bamboo huts bobbing on Tonle Sap Lake in central Cambodia, moves around as the water level rises and falls. Residents tow behind them the necessities of life: shops, a schoolhouse, clinic and pagoda.
The village is one of several settlements around Tonle Sap whose inhabitants lead an entirely aquatic existence. In a lifestyle that has barely changed for decades, the men fish and sell their catch while the women dry the fish and mend nets. Children paddle to class in canoes and the whole community floats, including the hairdresser's, grocery store, petrol pumps and karaoke bar.
Tonle Sap, the largest inland waterway in South-east Asia, is Cambodia's heart and lungs. Three million people - more than a quarter of the population - live on and around the Great Lake, as it is called. Much of the economy depends upon it; many families rely on it for their livelihood and its 850 species of fish - including giant catfish weighing up to 135kg - are a key source of protein for the nation. Rice is grown on surrounding plains that are flooded annually when the waters rise.
The lake - upstream of Tonle Sap river, which meets the Mekong river in Phnom Penh - is also notable for a unique phenomenon. During the monsoon season, the lower Mekong becomes so bloated that it forces the Tonle Sap to reverse direction and flow away from the sea, flooding the lake with vast quantities of fresh water. When the dry season arrives, Tonle Sap reverts to its usual course, draining the lake basin into the Mekong.
This singular event is celebrated in a water festival, Bon Om Touk, an exuberant spectacle in which longboats compete for three days, finishing in front of the Royal Palace in Phnom Penh. A few years back, the race was staged on the moats that encircle the temple complex of Angkor Wat.
Bon Om Touk, an important part of Khmer culture, takes place in late October or early November, but the wonders of Tonle Sap can be experienced at any time of year. Ferries ply the length of the lake, connecting the capital with Siem Reap, the sleepy colonial town that services Angkor Wat. The six-hour boat trip is preferable to travelling by road, as the nation's highways are atrocious. Besides, to fly means missing out on magnificent scenery.
It was a bedraggled collection of passengers that boarded the cigar-shaped ferry in Phnom Penh following a pre-dawn tropical downpour one autumn morning. Families arrived at the jetty shrouded in plastic raincoats, three or four people to one motorbike, with just the driver's head peeking out. By the time we chugged out of port, the rain had subsided to a gentle drizzle and, as the river widened into the brown expanse of lake, the sun appeared, sending soft rays slanting across the water.
As the ferry navigated between tufts of drowned vegetation, the first of the many communities that cling to the rim of the lake came into view. The water level was so high that it lapped at the front doors of wooden stilt houses clustered on the shore. The dome of a pagoda, built a little inland, was visible behind waterlogged trees. Boys glided past in longboats, fishing for carp, while women punted down little muddy tributaries that snaked off in all directions.
The lake, which covers 2,500 sq km during the November-to-June dry season, can swell to up to 12,500sq km during the monsoon, gaining 70km in length. When it shrinks, the villages move too, seeking deeper waters further out into the lake. Submerged tree-tops reappear and fish are found stranded in the reeds - a sight that prompted an early 20th-century French author, Pierre Loti, to describe Cambodia as the land where fish grow on trees.
Tonle Sap's role over the centuries as a major food source for the Khmer people is depicted in bas-relief carvings at the wonderful Bayon temple at Angkor Wat. The lake, part of which is a World Heritage site, is also a birdwatcher's paradise. Three endangered species - the spot-billed pelican, greater adjutant stork and white-winged duck - can be seen at Prek Toal, a bird sanctuary easily reached from Siem Reap.
From Siem Reap, you can get a taste of life on Tonle Sap by visiting Phnom Krom, a nearby floating community. During the rains, Phnom Krom is situated near the mouth of the Siem Reap river; when the water level rises, it moves a couple of miles into the lake. Rowing boats moored by the narrow road that winds cross rice paddies to the ferry port take tourists out to the village. Phnom Krom is predominantly Vietnamese, although it is also home to substantial numbers of Khmers; locals joke that it is one of the few places where the two races - long-time sworn enemies - live in harmony side by side.
Some residents operate fish farms; you can see thrashing catfish being removed from massive tanks and small silvery fish shovelled into bamboo baskets for processing into prahok, a fermented fish condiment central to Khmer cuisine. A forest of aerials disfigures the skyline; television is one of the few entertainments for waterborne communities.
Friends had warned that the ferry trip can be rough, and they were right. Midway into the lake, the sky turned dark grey and high winds picked up, bringing a slather of rain. The passengers - a mixture of Phnom Penh teenagers sitting cross-legged on the deck and peasant families overloaded with produce and children - huddled beneath blankets and tried to prevent their belongings from blowing away. We reached Siem Reap in the same drenched state in which we had boarded the boat that morning.
I meet some of the waterborne nomads
A signpost on the road leading to Kompong Luong advises that the village is "maximum 7km, minimum 2km" away. Kompong Luong, a collection of bamboo huts bobbing on Tonle Sap Lake in central Cambodia, moves around as the water level rises and falls. Residents tow behind them the necessities of life: shops, a schoolhouse, clinic and pagoda.
The village is one of several settlements around Tonle Sap whose inhabitants lead an entirely aquatic existence. In a lifestyle that has barely changed for decades, the men fish and sell their catch while the women dry the fish and mend nets. Children paddle to class in canoes and the whole community floats, including the hairdresser's, grocery store, petrol pumps and karaoke bar.
Tonle Sap, the largest inland waterway in South-east Asia, is Cambodia's heart and lungs. Three million people - more than a quarter of the population - live on and around the Great Lake, as it is called. Much of the economy depends upon it; many families rely on it for their livelihood and its 850 species of fish - including giant catfish weighing up to 135kg - are a key source of protein for the nation. Rice is grown on surrounding plains that are flooded annually when the waters rise.
The lake - upstream of Tonle Sap river, which meets the Mekong river in Phnom Penh - is also notable for a unique phenomenon. During the monsoon season, the lower Mekong becomes so bloated that it forces the Tonle Sap to reverse direction and flow away from the sea, flooding the lake with vast quantities of fresh water. When the dry season arrives, Tonle Sap reverts to its usual course, draining the lake basin into the Mekong.
This singular event is celebrated in a water festival, Bon Om Touk, an exuberant spectacle in which longboats compete for three days, finishing in front of the Royal Palace in Phnom Penh. A few years back, the race was staged on the moats that encircle the temple complex of Angkor Wat.
Bon Om Touk, an important part of Khmer culture, takes place in late October or early November, but the wonders of Tonle Sap can be experienced at any time of year. Ferries ply the length of the lake, connecting the capital with Siem Reap, the sleepy colonial town that services Angkor Wat. The six-hour boat trip is preferable to travelling by road, as the nation's highways are atrocious. Besides, to fly means missing out on magnificent scenery.
It was a bedraggled collection of passengers that boarded the cigar-shaped ferry in Phnom Penh following a pre-dawn tropical downpour one autumn morning. Families arrived at the jetty shrouded in plastic raincoats, three or four people to one motorbike, with just the driver's head peeking out. By the time we chugged out of port, the rain had subsided to a gentle drizzle and, as the river widened into the brown expanse of lake, the sun appeared, sending soft rays slanting across the water.
As the ferry navigated between tufts of drowned vegetation, the first of the many communities that cling to the rim of the lake came into view. The water level was so high that it lapped at the front doors of wooden stilt houses clustered on the shore. The dome of a pagoda, built a little inland, was visible behind waterlogged trees. Boys glided past in longboats, fishing for carp, while women punted down little muddy tributaries that snaked off in all directions.
The lake, which covers 2,500 sq km during the November-to-June dry season, can swell to up to 12,500sq km during the monsoon, gaining 70km in length. When it shrinks, the villages move too, seeking deeper waters further out into the lake. Submerged tree-tops reappear and fish are found stranded in the reeds - a sight that prompted an early 20th-century French author, Pierre Loti, to describe Cambodia as the land where fish grow on trees.
Tonle Sap's role over the centuries as a major food source for the Khmer people is depicted in bas-relief carvings at the wonderful Bayon temple at Angkor Wat. The lake, part of which is a World Heritage site, is also a birdwatcher's paradise. Three endangered species - the spot-billed pelican, greater adjutant stork and white-winged duck - can be seen at Prek Toal, a bird sanctuary easily reached from Siem Reap.
From Siem Reap, you can get a taste of life on Tonle Sap by visiting Phnom Krom, a nearby floating community. During the rains, Phnom Krom is situated near the mouth of the Siem Reap river; when the water level rises, it moves a couple of miles into the lake. Rowing boats moored by the narrow road that winds cross rice paddies to the ferry port take tourists out to the village. Phnom Krom is predominantly Vietnamese, although it is also home to substantial numbers of Khmers; locals joke that it is one of the few places where the two races - long-time sworn enemies - live in harmony side by side.
Some residents operate fish farms; you can see thrashing catfish being removed from massive tanks and small silvery fish shovelled into bamboo baskets for processing into prahok, a fermented fish condiment central to Khmer cuisine. A forest of aerials disfigures the skyline; television is one of the few entertainments for waterborne communities.
Friends had warned that the ferry trip can be rough, and they were right. Midway into the lake, the sky turned dark grey and high winds picked up, bringing a slather of rain. The passengers - a mixture of Phnom Penh teenagers sitting cross-legged on the deck and peasant families overloaded with produce and children - huddled beneath blankets and tried to prevent their belongings from blowing away. We reached Siem Reap in the same drenched state in which we had boarded the boat that morning.
Community Fisheries - CFDO
Abstraction
Fishery resources are under heavy pressure from an increasing population that uses natural resources for their livelihoods; as well as increased conflict spreading amongst the areas, the conflicts come from benefices and the person who use fisheries resources.
Unsuccessful in using a single method of law reform in caring for fisheries resources, with problems and conflicts in using fisheries resources. The results show that the poor fishers are incapable of making a living for their livelihoods, without recourse to using illegal fishing and thus the fishery resources become decreased.
In October 2000 the Royal Government of Cambodia started a reform to release around 56% of fishing lots in Cambodia to fishers who set up Community Fisheries to manage these fishing lots that are release and cut from lots. Fisheries reform has the objective to make realistic use of fishery resources in a sustainable manner and to increase the standard of living of fishers.
Up until now 360 Community Fisheries have been established and are undergoing a transitional period across the Country, with no policy regulating guidelines for implementation, or measures taken to set up and manage methods by Community Fisheries with a vision for Cambodia which has low human resources knowledge, experience and limited management capacity.
According to study, the vision and definition deferent for Community Fisheries as Co Fisheries Community management Fisheries Resources management depends on the community and Community Fisheries.
Community Fisheries amount to 6 types and undergo about 13 steps for management, but no one Community Fishery has implemented all of those steps.
Establishment and declaration guidelines have a slow course to establishment, and Community Fisheries management are not yet good enough because they do not know their duties, responsibilities or rights for using natural resources and managing them.
By promoting and supporting the fisheries authorities, relevant institutions, non-government organisations and international organisations, some Community Fisheries are well implemented, although some Community Fisheries have been implemented better than others.
Community Fisheries need a solid implementation and development to achieve their goal, which need time and enough of a budget to develop a full policy and to define their duties, responsibilities and rights. These can be achieved by promoting and supporting all areas as well as motivating in integrating the implementation smoothly from top to bottom.
Fishery resources are under heavy pressure from an increasing population that uses natural resources for their livelihoods; as well as increased conflict spreading amongst the areas, the conflicts come from benefices and the person who use fisheries resources.
Unsuccessful in using a single method of law reform in caring for fisheries resources, with problems and conflicts in using fisheries resources. The results show that the poor fishers are incapable of making a living for their livelihoods, without recourse to using illegal fishing and thus the fishery resources become decreased.
In October 2000 the Royal Government of Cambodia started a reform to release around 56% of fishing lots in Cambodia to fishers who set up Community Fisheries to manage these fishing lots that are release and cut from lots. Fisheries reform has the objective to make realistic use of fishery resources in a sustainable manner and to increase the standard of living of fishers.
Up until now 360 Community Fisheries have been established and are undergoing a transitional period across the Country, with no policy regulating guidelines for implementation, or measures taken to set up and manage methods by Community Fisheries with a vision for Cambodia which has low human resources knowledge, experience and limited management capacity.
According to study, the vision and definition deferent for Community Fisheries as Co Fisheries Community management Fisheries Resources management depends on the community and Community Fisheries.
Community Fisheries amount to 6 types and undergo about 13 steps for management, but no one Community Fishery has implemented all of those steps.
Establishment and declaration guidelines have a slow course to establishment, and Community Fisheries management are not yet good enough because they do not know their duties, responsibilities or rights for using natural resources and managing them.
By promoting and supporting the fisheries authorities, relevant institutions, non-government organisations and international organisations, some Community Fisheries are well implemented, although some Community Fisheries have been implemented better than others.
Community Fisheries need a solid implementation and development to achieve their goal, which need time and enough of a budget to develop a full policy and to define their duties, responsibilities and rights. These can be achieved by promoting and supporting all areas as well as motivating in integrating the implementation smoothly from top to bottom.
Fish Exports from Cambodia
Summary
Fisheries play a vital role in supporting rural livelihoods throughout Cambodia, but especially around the Tonle Sap (Great Lake) area where more than one million people depend on the fisheries sector for employment, income, and food security. With large surpluses of fish caught during peak fishing periods, fish trade and export is critical to income growth in the sector. Presently, fresh and processed fish are traded widely within Cambodia, exported in significant quantities to neighbouring countries, and in some instances exported to more distant markets. However, beyond this general picture, much remains unclear about fish marketing and export.
With an inland fisheries catch of more than 400,000 tonnes per year, Cambodia’s fisheries sector has been targeted as an important sector for export promotion. This promotion is occurring within the context of broader regional and international trade agreements, namely the ASEAN Free Trade Agreement and World Trade Organisation accession. While regional and international market integration is intended to spur “pro-poor” trade, to be effective, market integration and trade efficiencies will also need to be improved domestically, especially within and from rural areas.
Constraints on fish trade and export can negatively affect the livelihoods of the many small- and medium-scale fishers supplying exporters, as well as others working in the sector. When costs, fees, and risks associated with fish export make it difficult for exporters to earn a profit, they must reduce prices offered to fish suppliers in order to stay in business, which in turn can reduce incomes throughout the sector. Conversely, where policy changes can increase efficiencies and lower costs for trade and export, much of the benefit would be passed on to fishers (through higher prices for their fish) because exporters are intensely competing for fish supply.
To assess the current conditions under which fish are exported from Cambodia, the Natural Resources and Environment Programme of the Cambodia Development Resource Institute carried out a fish exports study from November 2002 to June 2003, with much of the fieldwork conducted during an intensive period in January 2003. The study focused on fish exports from the Great Lake to Thailand (via Poipet). Information and data were collected through more than 70 semi-structured interviews with exporters, wholesalers, traders, fishers, and government officials. In addition, researchers made three “follow the fish” trips with export shipments to directly observe trade conditions and crosscheck information gathered in interviews. Key objectives included identifying the typical market structure, describing credit and financing arrangements, assessing trade and export constraints, quantifying transaction costs (including fees), describing the official regulatory framework and actual practices, and identifying policy recommendations.
Market Structure
The market structure for fish exports from the Great Lake to Thailand involves thousands of fishers, traders, wholesalers, exporters, and Thai market distributors. Credit plays a critical role in this market structure with nearly all fishers and traders interviewed dependent on credit to support their businesses and activities. Vertical relationships based on credit ensure that fishers only sell to their trader/creditor, and traders only sell to their exporter/creditor, providing stability in the supply of fish for export.
In contrast to the stability created through credit and financing dependencies, a number of dynamic changes have been taking place within the market structure, as reflected in the collapse of KAMFIMEX’s monopoly, rise of CDCO, and consolidation of unlicensed exporters. These changes are occurring in the context of intensified competition for fish due to a declining supply and pervasive fee charges that reduce profit margins.
Profit margins are also under pressure due to the weak price negotiation position of Cambodian exporters within the current market structure. With no other export options except to sell at Long Koeur market in Thailand, and the combined threats of repaying border fees, additional labour costs, and high spoilage levels if they do not sell on the day they cross the border to Long Koeur market, exporters often find themselves accepting lower prices than expected for their fish. Exporters suggest that the presence of fish distribution facilities in Poipet would allow them to store fish for several days if necessary, making it possible to negotiate better prices with Thai distributors.
Export Costs and Fees
Data collected on fish exports from the five landing sites studied indicate, with little variation, that exporters face significant fee charges that absorb a large proportion of their potential earnings. At $83 per tonne, fees add more than 50 percent to the costs of exporting fish. Indeed, fees represent the highest component of export costs, followed by spoilage/weight loss ($51 per tonne) and transportation ($26 per tonne). Average profit margins are estimated to be about $38 per tonne. The fact that fees levels are more than twice as much as the profit margin earned on fish exports is a strong indication of the widespread “rent-seeking” activity of government institutions and officials. Fee extraction is maximised to the point where exporters report their foremost goal is business survival; investment and business growth are not viewed as possible.
Closer examination of fish export fees (through a case analysis of a shipment from Chhnok Tru in Kompong Chhnang province to Long Koeur market in Thailand) reveals several striking findings. First, exporting fish along this route involves 27 different fee payments to 15 institutions in 16 different places. The most significant fees are paid for issuing and “checking” transport permits, followed by payments to customs, a road investment company, and a range of institutions with no legal basis for collecting fees. Second, of the institutions collecting fees, fisheries institutions collect the greatest amount but this represents only 20 percent of total fees. Institutions with no direct role in fisheries management collect 80 percent of fees. Third, more than half of all fees are collected at the border. In contrast, the provincial fisheries office of Kompong Chhnang, which is responsible for fisheries management in the area, collects only about three percent of all fees (one percent is recorded as an official fee and two percent is collected informally). Finally, when comparing actual payments to official fees (if enforced), it is starkly clear that prior to any efforts to improve official compliance, the fee system itself needs to be overhauled. Enforcement of current regulations and fees would triple the current payments made by exporters, which would surely cause a collapse in fish exports.
Regulatory Framework and Actual Practice
Actual practices undertaken to export fish bear little resemblance to what is required under the official regulatory system. Most fish shipped through Poipet are exported without a license, and exported throughout the year regardless of closed season regulations. This informal process involves numerous fee payments to a variety of institutions at the landing site, along the road, and at the border. Fees are either charged with no legal basis, or, where a legal basis exists, negotiated to support informal payments. Surprisingly, licensed exporters report that they make the same series of informal payments as unlicensed exporters, despite holding a license from the Ministry of Agriculture, Forestry and Fisheries and Customs Department in Phnom Penh.
Based on interviews with exporters and observations of fish shipments, there are no instances in which official fees are paid in accordance with the official rate. All fees are negotiated. Since most official fees are based on fish quantity and/or value of the fish shipment, the most common method used by officials to collect informal payments is to vastly underreport fish quantities in licenses and permits. For example, fisheries officials record only one-fourth to one-tenth of the actual shipment amount in transport permits. Such underreporting allows officials to negotiate an informal payment on top of the much-reduced official fee.
Since many payments have no clear legal basis and may differ from trip to trip, exporters complain that the arbitrariness of payments makes operating a business very difficult because of uncertainty about costs. In an interesting market response to this problem, brokers have begun providing the service of taking responsibility for checkpoint and border fee payments in return for a set price. Through their positions as current/past government officials, military, or military police, brokers have established relations with fee collecting institutions, making it possible for them to pay lower fees and have greater certainty about fee charges than exporters who pay directly.
Recommendations
In the promotion of fish exports, much of the focus has been on spurring investment in value-added processing, improving quality standards and control, and identifying high-value export markets. Given the lack of processing, problems with quality, and scant exports to countries other than Thailand and Vietnam, these efforts are clearly important. But investment and quality improvements are unlikely to come without first having significant changes in the climate for business and trade within the fisheries sector, including a substantial and credible reduction in current fees and transparency and certainty about the regulatory environment.
Based on the findings of this study, twelve recommendations are summarised below. They are grouped under three themes:
· Improve governance and transparency; this must include a significant overhaul of the current license, permit, and fee system.
1. Remove the transport permit requirement for fish trade.
2. Eliminate fees collected by checkpoints and institutions that have no clear legal basis for collecting fees.
3. Make a public statement that “Sending Goods” letters from KAMFIMEX are no longer required for fish export.
4. End the contract with Ban Sambath House.
5. Eliminate the 4 percent fish distribution centre fees in Battambang province.
6. Revise downward the 10 percent export tax charged by the Cambodian Customs Department.
· Increase linkages and accountability between fee payments and fisheries management.
7. Concentrate fee collection at fishing grounds to support fisheries management and enforcement; eliminate or sharply reduce fee collection elsewhere.
8. Establish ‘one-stop’ fee payment service with transparent procedures and clearly defined fee levels.
9. Consider re-imposing a fishing license fee on middle-scale fishers (if transparent fee collection is possible).
· Facilitate the development of a more efficient fish trade, distribution, and export system.
10. Encourage investment in the establishment of fish distribution centres at Poipet.
11. Remove barriers to export via Sihanoukville; support identification of new export markets.
12. Support further study of the credit system in the fisheries sector.
Fisheries play a vital role in supporting rural livelihoods throughout Cambodia, but especially around the Tonle Sap (Great Lake) area where more than one million people depend on the fisheries sector for employment, income, and food security. With large surpluses of fish caught during peak fishing periods, fish trade and export is critical to income growth in the sector. Presently, fresh and processed fish are traded widely within Cambodia, exported in significant quantities to neighbouring countries, and in some instances exported to more distant markets. However, beyond this general picture, much remains unclear about fish marketing and export.
With an inland fisheries catch of more than 400,000 tonnes per year, Cambodia’s fisheries sector has been targeted as an important sector for export promotion. This promotion is occurring within the context of broader regional and international trade agreements, namely the ASEAN Free Trade Agreement and World Trade Organisation accession. While regional and international market integration is intended to spur “pro-poor” trade, to be effective, market integration and trade efficiencies will also need to be improved domestically, especially within and from rural areas.
Constraints on fish trade and export can negatively affect the livelihoods of the many small- and medium-scale fishers supplying exporters, as well as others working in the sector. When costs, fees, and risks associated with fish export make it difficult for exporters to earn a profit, they must reduce prices offered to fish suppliers in order to stay in business, which in turn can reduce incomes throughout the sector. Conversely, where policy changes can increase efficiencies and lower costs for trade and export, much of the benefit would be passed on to fishers (through higher prices for their fish) because exporters are intensely competing for fish supply.
To assess the current conditions under which fish are exported from Cambodia, the Natural Resources and Environment Programme of the Cambodia Development Resource Institute carried out a fish exports study from November 2002 to June 2003, with much of the fieldwork conducted during an intensive period in January 2003. The study focused on fish exports from the Great Lake to Thailand (via Poipet). Information and data were collected through more than 70 semi-structured interviews with exporters, wholesalers, traders, fishers, and government officials. In addition, researchers made three “follow the fish” trips with export shipments to directly observe trade conditions and crosscheck information gathered in interviews. Key objectives included identifying the typical market structure, describing credit and financing arrangements, assessing trade and export constraints, quantifying transaction costs (including fees), describing the official regulatory framework and actual practices, and identifying policy recommendations.
Market Structure
The market structure for fish exports from the Great Lake to Thailand involves thousands of fishers, traders, wholesalers, exporters, and Thai market distributors. Credit plays a critical role in this market structure with nearly all fishers and traders interviewed dependent on credit to support their businesses and activities. Vertical relationships based on credit ensure that fishers only sell to their trader/creditor, and traders only sell to their exporter/creditor, providing stability in the supply of fish for export.
In contrast to the stability created through credit and financing dependencies, a number of dynamic changes have been taking place within the market structure, as reflected in the collapse of KAMFIMEX’s monopoly, rise of CDCO, and consolidation of unlicensed exporters. These changes are occurring in the context of intensified competition for fish due to a declining supply and pervasive fee charges that reduce profit margins.
Profit margins are also under pressure due to the weak price negotiation position of Cambodian exporters within the current market structure. With no other export options except to sell at Long Koeur market in Thailand, and the combined threats of repaying border fees, additional labour costs, and high spoilage levels if they do not sell on the day they cross the border to Long Koeur market, exporters often find themselves accepting lower prices than expected for their fish. Exporters suggest that the presence of fish distribution facilities in Poipet would allow them to store fish for several days if necessary, making it possible to negotiate better prices with Thai distributors.
Export Costs and Fees
Data collected on fish exports from the five landing sites studied indicate, with little variation, that exporters face significant fee charges that absorb a large proportion of their potential earnings. At $83 per tonne, fees add more than 50 percent to the costs of exporting fish. Indeed, fees represent the highest component of export costs, followed by spoilage/weight loss ($51 per tonne) and transportation ($26 per tonne). Average profit margins are estimated to be about $38 per tonne. The fact that fees levels are more than twice as much as the profit margin earned on fish exports is a strong indication of the widespread “rent-seeking” activity of government institutions and officials. Fee extraction is maximised to the point where exporters report their foremost goal is business survival; investment and business growth are not viewed as possible.
Closer examination of fish export fees (through a case analysis of a shipment from Chhnok Tru in Kompong Chhnang province to Long Koeur market in Thailand) reveals several striking findings. First, exporting fish along this route involves 27 different fee payments to 15 institutions in 16 different places. The most significant fees are paid for issuing and “checking” transport permits, followed by payments to customs, a road investment company, and a range of institutions with no legal basis for collecting fees. Second, of the institutions collecting fees, fisheries institutions collect the greatest amount but this represents only 20 percent of total fees. Institutions with no direct role in fisheries management collect 80 percent of fees. Third, more than half of all fees are collected at the border. In contrast, the provincial fisheries office of Kompong Chhnang, which is responsible for fisheries management in the area, collects only about three percent of all fees (one percent is recorded as an official fee and two percent is collected informally). Finally, when comparing actual payments to official fees (if enforced), it is starkly clear that prior to any efforts to improve official compliance, the fee system itself needs to be overhauled. Enforcement of current regulations and fees would triple the current payments made by exporters, which would surely cause a collapse in fish exports.
Regulatory Framework and Actual Practice
Actual practices undertaken to export fish bear little resemblance to what is required under the official regulatory system. Most fish shipped through Poipet are exported without a license, and exported throughout the year regardless of closed season regulations. This informal process involves numerous fee payments to a variety of institutions at the landing site, along the road, and at the border. Fees are either charged with no legal basis, or, where a legal basis exists, negotiated to support informal payments. Surprisingly, licensed exporters report that they make the same series of informal payments as unlicensed exporters, despite holding a license from the Ministry of Agriculture, Forestry and Fisheries and Customs Department in Phnom Penh.
Based on interviews with exporters and observations of fish shipments, there are no instances in which official fees are paid in accordance with the official rate. All fees are negotiated. Since most official fees are based on fish quantity and/or value of the fish shipment, the most common method used by officials to collect informal payments is to vastly underreport fish quantities in licenses and permits. For example, fisheries officials record only one-fourth to one-tenth of the actual shipment amount in transport permits. Such underreporting allows officials to negotiate an informal payment on top of the much-reduced official fee.
Since many payments have no clear legal basis and may differ from trip to trip, exporters complain that the arbitrariness of payments makes operating a business very difficult because of uncertainty about costs. In an interesting market response to this problem, brokers have begun providing the service of taking responsibility for checkpoint and border fee payments in return for a set price. Through their positions as current/past government officials, military, or military police, brokers have established relations with fee collecting institutions, making it possible for them to pay lower fees and have greater certainty about fee charges than exporters who pay directly.
Recommendations
In the promotion of fish exports, much of the focus has been on spurring investment in value-added processing, improving quality standards and control, and identifying high-value export markets. Given the lack of processing, problems with quality, and scant exports to countries other than Thailand and Vietnam, these efforts are clearly important. But investment and quality improvements are unlikely to come without first having significant changes in the climate for business and trade within the fisheries sector, including a substantial and credible reduction in current fees and transparency and certainty about the regulatory environment.
Based on the findings of this study, twelve recommendations are summarised below. They are grouped under three themes:
· Improve governance and transparency; this must include a significant overhaul of the current license, permit, and fee system.
1. Remove the transport permit requirement for fish trade.
2. Eliminate fees collected by checkpoints and institutions that have no clear legal basis for collecting fees.
3. Make a public statement that “Sending Goods” letters from KAMFIMEX are no longer required for fish export.
4. End the contract with Ban Sambath House.
5. Eliminate the 4 percent fish distribution centre fees in Battambang province.
6. Revise downward the 10 percent export tax charged by the Cambodian Customs Department.
· Increase linkages and accountability between fee payments and fisheries management.
7. Concentrate fee collection at fishing grounds to support fisheries management and enforcement; eliminate or sharply reduce fee collection elsewhere.
8. Establish ‘one-stop’ fee payment service with transparent procedures and clearly defined fee levels.
9. Consider re-imposing a fishing license fee on middle-scale fishers (if transparent fee collection is possible).
· Facilitate the development of a more efficient fish trade, distribution, and export system.
10. Encourage investment in the establishment of fish distribution centres at Poipet.
11. Remove barriers to export via Sihanoukville; support identification of new export markets.
12. Support further study of the credit system in the fisheries sector.
Fish Marketing in Cambodia
Summary
With an inland catch of more than 400,000 tonnes per year and high domestic rates of fish consumption, freshwater fish are one of Cambodia’s most important traded commodities. Fresh and processed fish are traded widely within Cambodia, with the majority of trade originating at the Tonle Sap (Great Lake). Fish marketing involves a number of steps and challenges including storage, handling, aggregating enough for a shipment, transportation, negotiating sales, and maintaining quality. Marketing inefficiencies raise costs, which can negatively affect the income of fish marketers as well as fishers and others working in the sector.
To assess current conditions under which freshwater fish are marketed, this study examines fish trade from two major landing sites at the Great Lake to retail markets in Phnom Penh – the largest domestic fish trade route. Findings are based on nearly 60 semi-structured interviews conducted with fishers, traders, distributors, a distribution centre owner, retailers, and government officials. In addition, two “follow the fish” trips were made with shipments from the landing site to the distribution centre in order to directly observe trade conditions and crosscheck information gathered in interviews.
Marketing fish from the Great Lake to Phnom Penh involves three main transactions – sales from fishers to traders, from traders to retailers via distributors, and from retailers to customers. Distributors play a dominant role in the market structure as the financiers of fish trade. They lend capital to traders to support fish purchases and trading activities, and traders re-lend some of this capital to fishers for gear purchases and other expenses. Under the terms of these loans, fishers must sell all fish to their trader (creditor), and traders must sell all fish through their distributor (creditor) and pay associated “commission fees” – usually about 6-8 percent of total sales revenue. These tied relations are common for trade from the Great Lake to Phnom Penh, with most fishers in debt to a trader, and most traders in debt to a distributor.
The current market structure supports a stable fish supply for trade, but the problem of credit dependency places fishers and (to a lesser extent) traders at a disadvantage. Fishers are clearly in a weak position for negotiating the sale of their catch. They must sell to the trader to whom they are in debt. Another problem is the lack of transparent financing costs. Because any interest charged on loans is either embedded in the (discounted) price offered to fishers for fish, or part of the “commission fee” that traders pay to distributors on all sales, the true cost of financing remains unclear. It is likely that lenders (distributors and traders) take advantage of this lack of transparency to increase returns on their loans.
Fish trade is affected by a number of other constraints as well. Traders and distributors criticise distribution centre fees as too high given the lack of services. But with only one centre serving Phnom Penh for each major trade route, they have no (legal) alternative place at which to conduct transactions. Some traders also complain about the fees they must pay along the trade route. Spoilage and weight loss represent a substantial cost at 10-15 percent of shipment weight (or about $55 per tonne). These value losses are compounded by the retail marketing practice of displaying fish for sale without ice. Retailers remove ice because it is the common perception of customers that the presence of ice indicates a lack of fish freshness. In total, these constraints result in marketing costs that average about $308 per tonne from the Great Lake to retail markets in Phnom Penh. As a result, marketing margins account for roughly 65-75 percent of fish retail prices; fishers receive 25-35 percent.
To improve the livelihoods of fishers through increased returns on their catch, steps need to be taken to reduce marketing costs and inefficiencies. To this end, the following policy recommendations are offered for consideration.
1) Inject competition into fish distribution services by granting additional licenses for distribution centres.
2) Campaign to change consumer perceptions about ice use and the freshness of freshwater fish at retail markets.
3) Conduct further technical research on spoilage problems in the marketing of fish from fishing grounds to distribution centres.
4) Determine the legality of current fee charges along domestic fish trade routes and eliminate fees that have no clear legal basis.
5) Carry out additional research on the role of the informal financing/credit system in the fisheries sector
With an inland catch of more than 400,000 tonnes per year and high domestic rates of fish consumption, freshwater fish are one of Cambodia’s most important traded commodities. Fresh and processed fish are traded widely within Cambodia, with the majority of trade originating at the Tonle Sap (Great Lake). Fish marketing involves a number of steps and challenges including storage, handling, aggregating enough for a shipment, transportation, negotiating sales, and maintaining quality. Marketing inefficiencies raise costs, which can negatively affect the income of fish marketers as well as fishers and others working in the sector.
To assess current conditions under which freshwater fish are marketed, this study examines fish trade from two major landing sites at the Great Lake to retail markets in Phnom Penh – the largest domestic fish trade route. Findings are based on nearly 60 semi-structured interviews conducted with fishers, traders, distributors, a distribution centre owner, retailers, and government officials. In addition, two “follow the fish” trips were made with shipments from the landing site to the distribution centre in order to directly observe trade conditions and crosscheck information gathered in interviews.
Marketing fish from the Great Lake to Phnom Penh involves three main transactions – sales from fishers to traders, from traders to retailers via distributors, and from retailers to customers. Distributors play a dominant role in the market structure as the financiers of fish trade. They lend capital to traders to support fish purchases and trading activities, and traders re-lend some of this capital to fishers for gear purchases and other expenses. Under the terms of these loans, fishers must sell all fish to their trader (creditor), and traders must sell all fish through their distributor (creditor) and pay associated “commission fees” – usually about 6-8 percent of total sales revenue. These tied relations are common for trade from the Great Lake to Phnom Penh, with most fishers in debt to a trader, and most traders in debt to a distributor.
The current market structure supports a stable fish supply for trade, but the problem of credit dependency places fishers and (to a lesser extent) traders at a disadvantage. Fishers are clearly in a weak position for negotiating the sale of their catch. They must sell to the trader to whom they are in debt. Another problem is the lack of transparent financing costs. Because any interest charged on loans is either embedded in the (discounted) price offered to fishers for fish, or part of the “commission fee” that traders pay to distributors on all sales, the true cost of financing remains unclear. It is likely that lenders (distributors and traders) take advantage of this lack of transparency to increase returns on their loans.
Fish trade is affected by a number of other constraints as well. Traders and distributors criticise distribution centre fees as too high given the lack of services. But with only one centre serving Phnom Penh for each major trade route, they have no (legal) alternative place at which to conduct transactions. Some traders also complain about the fees they must pay along the trade route. Spoilage and weight loss represent a substantial cost at 10-15 percent of shipment weight (or about $55 per tonne). These value losses are compounded by the retail marketing practice of displaying fish for sale without ice. Retailers remove ice because it is the common perception of customers that the presence of ice indicates a lack of fish freshness. In total, these constraints result in marketing costs that average about $308 per tonne from the Great Lake to retail markets in Phnom Penh. As a result, marketing margins account for roughly 65-75 percent of fish retail prices; fishers receive 25-35 percent.
To improve the livelihoods of fishers through increased returns on their catch, steps need to be taken to reduce marketing costs and inefficiencies. To this end, the following policy recommendations are offered for consideration.
1) Inject competition into fish distribution services by granting additional licenses for distribution centres.
2) Campaign to change consumer perceptions about ice use and the freshness of freshwater fish at retail markets.
3) Conduct further technical research on spoilage problems in the marketing of fish from fishing grounds to distribution centres.
4) Determine the legality of current fee charges along domestic fish trade routes and eliminate fees that have no clear legal basis.
5) Carry out additional research on the role of the informal financing/credit system in the fisheries sector
Ding Dong the bells are going to chime...
Just received a dark purple smelly envelope from one of my Khmer colleagues.
Yes folks, that is right, my first Khmer wedding invitation !
A couple of weekends from now I will be drinking warm beer at 08:00, having monks throw water and lotus petals over me while eating chicken gizzard porridge.
So what the hell is the form ? I know that I am supposed to slip some cash into an envelope at some point and slip it to somebody, but who? When?? How much??? aggghhhh
Yes folks, that is right, my first Khmer wedding invitation !
A couple of weekends from now I will be drinking warm beer at 08:00, having monks throw water and lotus petals over me while eating chicken gizzard porridge.
So what the hell is the form ? I know that I am supposed to slip some cash into an envelope at some point and slip it to somebody, but who? When?? How much??? aggghhhh
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