3 - The Human Face of the Crisis: Key Findings of Vulnerable Worker and Rural Household Surveys

Summary

DOUBLE BLOW FOR THE CAMBODIAN POOR

The past years have been challenging times for the poor. The price escalations resulting from the food and energy crises threatened food security and barely translated to profit for the many farming households constrained by higher input prices, lack of market access and land insecurity. While those adversely affected were still coming to terms with the negative effects of the food and energy shocks, the global financial and economic crisis struck. Prices may have gone down due to the recession but, as argued in the first chapter, the costs of the downturn were higher. In developing East Asia, as many as 9 million more people could have fallen into poverty in 2009 and 14 million more in 2010. Cambodia is one of the countries in the region expected to have experienced an absolute increase in poverty. Partially reversing earlier successes in poverty reduction, the crises of the recent years could have increased the country's 2007 poverty headcount of 30 per cent by 1–4 percentage points (World Bank 2009b, 2010).

This chapter examines the micro–level impact of the global financial and economic crisis by employing quantitative techniques. In particular, it uses the results of CDRI's vulnerable worker surveys (VWS) and rural household surveys (RHS). In doing so, it hopes to substantiate the poverty impact of the crisis based on the thesis that it was shaped by endogenous factors. Perhaps more importantly, this chapter also relates the actual hardship experienced by the poor and the vulnerable due to the shock. The severity of the blow of the crisis can only be appreciated by understanding how the contractions at the aggregate level translated to and were driven by developments at the micro–level. Section 2 describes the origins and components of the VWS before discussing its key findings. Section 3 on the other hand describes the origins and components of the RHS before also discussing its chief findings.