Inequality is a contentious issue. It has been described in recent years as “the biggest threat to the world” and “a blemish on Asia’s growth story”, yet its importance continues to be denied by policymakers and commentators who persist in pointing to GDP figures as the universal recognisable hallmark of prudent stewardship. Supporting this position, a popular perspective among economic liberals holds it is equality of opportunity, not income, that matters. Metaphorically speaking, “a rising tide lifts all boats”, even if transient waves of fortune leave some looking up or down at others.
This argument has long been applied to Cambodia, where a blistering period of growth in the early part of the new millennium contributed to a sextupling of the economy between 1993 and 2015.
During this time, even the lowest placed boats appeared to be rising: development indicators showed substantial improvement, with poverty more than halving, from 53.2 percent to 20.5 percent, life expectancy at birth increasing 15.2 years and mean years of schooling increasing 4.2 years. In many ways it is difficult to argue: many of Cambodia’s poorest are indeed better off than they were in the 1990s.
However, when it comes to inequality, the numbers are less clear. National figures show income inequality rising during the last decade and subsequently declining in the early part of this. Yet these sharp peaks and troughs are unlikely to reflect real change, betraying a fundamental misconception of how inequality manifests in developing countries.
Less than a quarter of the working population are formally employed and aggregate income measures are not set up to capture the subtleties of farming livelihoods, where production and consumption are blurred; or the complications of translocal livelihoods, where multidirectional flows of goods and money criss-cross the rural-urban “divide”, linking rising and falling fortunes over hundreds of kilometres.
Consequently, to view this inequality in the current crude and individualised manner conceals a great deal of its nature. Subtle differences matter greatly here and one of the gravest errors made by analysts is to present the big picture without attending to these details.
In Cambodia, a farm is not just a farm and garment work is not just garment work. Whether inscribed in the cracked earth of a drought-hit paddy field; the rain-soaked mud of a new high rise’s foundations; or the searching hands and heavy stares of colleagues in a notorious factory, inequality lives in the details.
More accurately, it lives in the choices available to those confronted with such details. Anybody can find themselves in a difficult situation. What matters is the ability to adapt or abandon it. The better off do not put up with what they cannot stand, while the worst off must do exactly that: bearing conditions no one else will, out of necessity.
It is no coincidence, for example, that workers in the most difficult and dangerous jobs tend to come from the poorest backgrounds. Faced with skyrocketing costs of farming inputs, many rural families find themselves unable to produce the crops that once sustained them, leaving them three options: debt, land sale or the migration of one or more members.
The first two options merely postpone the third. As money flows through the countryside like never before – $500,000,000 per year from the garment sector alone, according to estimates by CARE International – rural areas have become increasingly marketised. A purely agricultural life is increasingly impossible: The money to farm has to come from somewhere.
Yet the manner in which this money is obtained reflects deep rural divides: Rich people go outside the village to migrate just the same as poor people, but still there is something different. Rich people always migrate together with other rich people, whereas poor people just go with other poor people. Then, when they come back, they still stay separate.
As everywhere, the rural “haves” are better connected; their sphere of influence greater. As noted in recent research, ownership of something as simple as a bicycle or motorbike is not merely a status symbol, but a key indicator of future prosperity for the whole family. Mobility is a window to the world and when it comes to taking opportunities, the ability to see further is crucial.
While wealthier villagers draw on their social networks for well-paid construction or garment industry jobs, the worst off often depend on the exploratory endeavours of middlemen, recruiting them into denigrated or undesirable occupations such as garbage work or household service.
For the “have nots” of Cambodia’s western provinces, the most likely trajectory is an illegal cross-border migration to Thailand, undertaken without documents – the cheapest and most dangerous route – and thus at the whim of brokers and employers to whom all autonomy is ceded.
Even for those working within the Kingdom, differences in circumstance are stark. New arrivals to Phnom Penh’s factories and construction sites are not blessed with a clean slate and the chance to “make it” on their own terms.
They come bearing the burden of family needs. For those few whose families have no need for support, migrant life is a cornucopia of opportunity. Connections may be built up through leisure and socialising, money saved and invested, and skills acquired. Though they may work hard, their lives are mobile and free.
This, though, is an exception. Ninety percent of migrant workers send home at least a part of their salary, parting with around 40 percent on average. Some migrants send home nearly two-thirds of their salary, subsisting in the barest circumstances with what remains.
The conditions they face are dreadful: a permanent state of ill-health and exhaustion on a bare minimum of the cheapest food. Yet despite this it is not the present that is most troubling.
As one garment worker, whose growing family debts compelled her to provide an unending supply of remittances, put it: “There is no future. If I work . . . for ten years, I just have ten more years ahead of me.” (Powim, June, 28, 2013.) Like others in similar circumstances, she is a modern day Sisyphus, doomed to endlessly pursue an unreachable goal.
Indeed, in the breakneck pace of contemporary Cambodian development, it is continuities and immobilities that stand out above all else. But seeking to ascertain whether these are ultimately down to opportunity or income reveals only “chicken and egg” circularity, where the simple answer is both.
Cambodia will be the joint sixth-fastest growing country in the world this year, according to the World Economic Forum. Many fortunes have been made and many more are in the process of accumulating. Yet focusing only on the growing distance between Cambodia’s elites and the remainder of the population conceals a far more widespread process of social differentiation.
Even in the countryside, villagers report that “the relationship between the rich and the poor is torn, as if it has been pulled apart”, and in the city, this process is further accentuated. Although BMWs parked next to families in cardboard houses may capture the imagination, it is the more subtle differences that signal a darker future.
The Kingdom’s development is only just beginning and those anchored to the bottom remain, for now, only subtly differentiated from those who are beginning to ascend. Yet for many the course has been set. Rendered immobile by their family’s poverty, “participants” in Cambodia’s development have been imprisoned, rather than liberated, by growth.
The National Employment Agency claims a mandate to improve job market information, but its efforts thus far are tiny in scale and limited to only a handful of sectors. If policymakers and development practitioners do not take a hand in the redistribution of opportunity, calibrating their interventions more finely than the traditional rural-urban, or inter-occupational categories allow, then the current gaps will become chasms.
Any number of cases exemplify the trajectory. Even by the crudest measures, more than 75 percent of citizens in the developing world are living in countries that are more unequal than in 1990. Cambodia is among these. But despite the equivocal nature of aggregate figures, vast inequality of information and mobility will see an upward trend consolidate in the near future.
What is necessary, then, is to understand that inequality of income and information are intertwined. Economic redistribution is a crucial tool in generating social well-being and inclusive development, but it is not the only one. In a rapidly changing country, the reliance on informal networks to spread news about job opportunities favours the best off and the best connected, condemning the Kingdom’s poor to economic immobility long before their plight is reflected in statistics.
Rather than relying on a free market of information, greater efforts to inform the country’s worst-off inhabitants about economic opportunity will pay dividends by presenting the country’s most vulnerable with another choice.
Simply put, greater attention to the small-scale manifestation of inequalitiy needs to be mainstreamed into development policy. From garment workers to rice farmers, Cambodians live in webs of mutual dependency that structure their current and future well-being. What the venerable commentator Meas Nee once called this “net of obligations” renders opportunity and income two sides of the same coin.
Yet a generalised failure to grasp this has blinded many interventions to the true face of deprivation. Development here is not the aggregation of individual experiences, but a contest played out between groups, families and networks. Only by recognising the importance of these linkages does the true nature of inequality become apparent. No rising tide can lift a boat whose “net” has become a chain.
Laurie Parsons has conducted large-scale projects examining inequalities in Cambodia’s economic development for Transparency International, Plan International, Save the Children, CARE International, ActionAid, the IDRC and the Royal University of Phnom Penh, among others.
Note: This article was originally published in the Phnom Penh Post on Aug 23, 2017
Disclaimer: All views expressed here belong to their respective author and do not represent the views of Enrich Institute