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ADB to Improve Skills, Competitiveness of Cambodia's Labor Force

News from Country Offices | 25 June 2019

PHNOM PENH, CAMBODIA (25 June 2019) — The Asian Development Bank (ADB) has approved a $60 million loan to boost the skills and competitiveness of Cambodia’s growing labor force, as the Government of Cambodia seeks to transition its economy from a low-skilled, labor-intensive growth model to a skills-driven one.

The loan aims to help Cambodia diversify and modernize its industrial sector by upgrading the facilities and equipment of selected technical training institutes (TTIs) around the country; improving the curriculum and skills of TTI trainers; and forging stronger ties between the government and business community to meet the changing needs of the labor market.

Cambodia is ranked 110th out of 140 economies in the 2018 Global Competitiveness Report owing to the difficulty faced by businesses in finding skilled employees to fill technical roles. The country’s technical and vocational education and training (TVET) programs are not meeting the needs of the labor market, with most diploma programs focusing on jobs in the service sector.

“Having a highly skilled labor force is essential for a country like Cambodia, which has a fast-growing economy and an expanding workforce,” said ADB Education Specialist for Southeast Asia Ms. Yumiko Yamakawa. “The ADB loan will focus on improving the skills of workers employed in high-growth sectors to fuel the country’s development. We are also making sure that all stakeholders, especially the government and the private sector, work together to boost workers’ skills.”

The Skills for Competitiveness Project will help train 18,000 qualified technicians (28% women), with higher employability and technical skills in four priority sectors: manufacturing, construction, electricity, and electronics. This will be done by strengthening five TTIs around Cambodia, including the upgrading of 16 new training facilities with gender-sensitive, inclusive, and energy-saving design features like separate dormitory floors and toilets for women; providing advanced and industry-grade training equipment; building capacity of trainers; and providing merit-based stipends to selected students.

The five TTIs identified for the project are the Battambang Institute of Technology, the Institute of Technology of Cambodia, the National Polytechnic Institute of Angkor, the National Technical Training Institute for TVET Park, and the Regional Polytechnic Institute Techo Sen Svay Rieng.

Furthermore, the project will provide upskilling and reskilling opportunities for existing workers to address skills gaps and skills shortage in the industrial sector through work-based learning programs. Eighteen work-based lending programs will be implemented in partnership with industry players, which will improve the competencies of about 360 workers.

The pilot skills development fund, an innovative model to increase and incentivize industry investments in skills development in Cambodia, will be expanded. The project will finance training proposals to be supported by the fund. This will provide training opportunities for at least 3,500 workers (25% women); develop the capacity of government agencies to strengthen the management of the fund; and provide support for establishing a new permanent agency, which will be fully operational by 2024.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. In 2018, it made commitments of new loans and grants amounting to $21.6 billion. Established in 1966, it is owned by 68 members—49 from the region.