National Road 10 was once a dream road. The proposed 189 km route would connect the Tonle Sap Lake region to the Southern Coastal Corridor and promised improvements in the flow of goods between regions and onwards to global markets.

On 9 March 2020, the dream project became a reality with a groundbreaking ceremony for National Road 10. The road, which will be completed in the next four years, is designed to serve as a strategic gateway to global markets, strengthen the regional economy and improve livelihoods for those living in Cambodia’s western region.

As Cambodia faces the uncertainty of COVID-19’s widespread economic impact, this gateway may offer an important means to a faster and more inclusive recovery.

A gateway for the agro-industry

Once built, the new route aims to reinforce Cambodia’s existing agricultural production system and stimulate trade diversification alongside industrial development. National Road 10 will enable agricultural products grown in Cambodia’s interior to be transported to key export gateways, notably Cambodia’s deep seaports in the provinces of Koh Kong and Sihanouk.

This improved connectivity to seaports increases the competitiveness and dynamism of agro-industries. Additional value can be created and distributed to value chain actors, especially smallholder farmers, which is of particular importance in the context of rebuilding the economy following the effects of a shock like the current pandemic. One crop that can benefit from this connectivity and add significant value across its supply chain is cassava.

The proximity of large-scale cassava production facilities to ports paves the way for increased investment in agro-industry, and subsequent transformation from resource-based agriculture to a bio-economy value chain. As a result, Cambodia will be better positioned in the future to supply global markets with value-added, eco-friendly products including starch, modified starch and bioethanol.

UNDP’s cassava project helps paves the way for National Road 10

Recognizing the potential of the crop to contribute to livelihood improvement and local economic development, UNDP partnered with the Ministry of Commerce (MoC) to work on development of a sustainable cassava sector. The joint working group formed under the project subsequently drafted the National Cassava Policy, including a cassava logistics strategy that was incorporated into Cambodia’s Logistic Masterplan. Part of this strategy involves designing an integrated value chain where cassava production, processing and export are centralized and located within 200-300 km from a port.

Through the coordination of UNDP and MoC, cassava associations representing both private sector and individual farmers brought the idea of a direct export route to the Ministry of Public Works and Transport (MPWT). This route would involve a shortcut road to improve the transport of cassava products to Cambodia’s ports.

Feasibility work on road construction for the route was conducted one year later. As a result of this action by MPWT, the road has become one of the most promising solutions to sustain cassava production and enhance Cambodia’s future competitiveness and attractiveness to private sector and prospective investors. This has a number of potential benefits for Cambodia’s overall development.

The role of improved cassava competitiveness in building a more inclusive economy  

The impact of this gateway to global markets for the sector offers opportunities to strengthen cassava as a cash crop for smallholder farmers and to act as a catalyst to build processing industries.

UNDP’s recent study on estimating economic and social returns by using General Equilibrium Modelling found that the potential returns to public investments in cassava are substantial, with the economic benefits outstripping costs by a factor of up to three to one over a ten-year period. Taking wider socioeconomic impacts in employment and poverty reduction into account, the modelling revealed that cassava generally out-performs alternative investments in rice production, livestock and food, and tourism sectors.

Moving forward with the National Cassava Policy, UNDP will work with the Ministry of Commerce, Ministry of Agriculture, Forestry and Fisheries, and related ministries as well as the private sector and farmer organizations to transform Cambodia into a home for cassava processing industries and a reliable supplier to the global markets.

While the impact of COVID-19 on Cambodia remains uncertain, breaking ground on National Road 10 provides new hope for farmers to move up the cassava value chain and to strengthen Cambodia’s capacity to recover through inclusive and equitable growth.

By Nick Beresford, Resident Representative, UNDP Cambodia
Leang Reathmana, National Project Manager, UNDP Cambodia