ADB approves $24.5m grant

The ADB has provided a $24.5 million grant to help develop a workforce skilled in more than just garment production. AFP

(Posted by CAAI News Media)

Wednesday, 18 November 2009 15:00 POST STAFF

Regional bank aims to offer vocational training programmes

Rising demand for skilled labor and inadequate investment in vocational training has created a shortage of skilled workers in Cambodia, affecting productivity and economic growth, officials have said.

To address these constraints, the Asian Development Bank’s (ADB) board of directors has approved a US$24.5 million grant from its concessional Asian Development Fund for a project to improve the government’s technical and vocational education training (TVET) system to make it more responsive to the country’s growing need for a skilled and educated workforce.

The project aims to provide an expanded and more integrated training system that is endorsed by industry and better aligned with the skills requirements of the formal and informal economies. The project will initially focus on three industry sectors – construction and business services, information and communication technology, and mechanics – to develop models for formal and nonformal training programmes. Later, similar training models will be rolled out for other industries.

Cambodia’s economy has grown significantly over the past decade, as the country transitions from a traditional agrarian base to a modern industrialised economy. However, the recent global financial crisis has significantly slowed Cambodia’s economic growth rate and highlighted the country’s vulnerability to shocks due to its narrow economic base. Agriculture, manufacturing and the services industry account for 85 percent of employment and 92 percent of its gross domestic product.

“The government recognises that the issue of productivity must be addressed, as must the need to attract new industries to increase the diversification of the economy,” said Wendy Duncan, principal education specialist in ADB’s Southeast Asia Department.

“It strongly believes that TVET has an important role to play in the effort to meet these challenges, and it recognises the need to transform TVET into a quality demand-driven training system that is relevant to industry.”

At the same time, the government recognises the continuing importance of providing nonformal basic skills training to help the young and unemployed in rural areas raise their incomes.

The primary beneficiaries of the project will be the rural underemployed, including workers recently displaced from the garment and other industries hit hard by the global financial crisis. As well, by 2020 it is expected that there will be at least a 30 percent increase in the number of employees holding formal TVET qualifications, Duncan said.

“Beneficiaries will acquire skills responsive to the needs of industries, which should raise productivity and incomes, and benefit the economy as a whole,” she said.

The government will contribute $3 million toward the project’s total cost of $27.52 million, the ADB said.