Technical Report: Estimating Minimum Expenditure Baskets and Expenditure Gaps in Cambodia

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1. Background

Prior to the COVID-19 crisis, Cambodia had been making great strides in GDP growth and poverty reduction over the previous two decades. However, many Cambodians remain economically vulnerable and the Government recognizes that more extensive social protection measures are required to ensure that vulnerable groups can meet their essential needs for a standard of living in line with Cambodia’s ambitions to graduate into upper middle income country status (National Social Protection Policy Framework 2016-2025).

Cambodia is highly vulnerable to climatic shocks, with floods and droughts occurring on a regular basis. These climatic events can have a direct impact on households’ incomes, livelihoods, and, by extension, their food security and access to basic services.
Furthermore, the actions taken by households to cope with shocks, such as reducing food consumption, withdrawing children from school, or selling productive assets, ultimately increase their vulnerability. This further undermines hard-won development gains and contributes to the transmission of poverty from one generation to the next.

Understanding economic access to essential needs and how this might change during climatic, health and economic shocks is thus critical to ensuring that vulnerable groups can maintain the access they need to goods and services required for a healthy, productive life. This technical report thus attempts to analyse the cost of essential needs in Cambodia by developing a Minimum Expenditure Basket (MEB) and calculating the expenditure gap of households most vulnerable to shocks.