23 Feb 2012
Source: alertnet // Thin Lei Win
By Thin Lei Win
BANGKOK (AlertNet) – Thousands of impoverished Cambodians who survived the country’s devastating floods last year are now further in debt due to losses incurred from the disaster, a report released this week by four aid agencies said.
Severe floods caused by heavy monsoon rains and a series of tropical storms overwhelmed the country in 2011, inundating 18 of the country’s 24 provinces. The floods killed 247 people and affected some 1.6 million – more than 10 percent of the population.
Even before the floods, nearly two thirds of households in Prey Veng, Kampong Thom and Kandal provinces, which were most affected by the deluge, were already in debt, said the report “Drowning in Debt,” which surveyed nearly 400 poor and flood-affected households in January.
After losing farms, livestock and jobs in the floods, nearly half of all households interviewed were forced to take out an additional loan, the study conducted by CARE, Oxfam, Catholic Relief Services and Pact said.
“Large numbers of rural communities are currently relying on borrowing money to support farming and basic necessities,” said the report.
While farmers usually sought loans to finance agricultural inputs, the report found almost 25 percent of the loans are now being used to pay immediate costs such as food, health and education.
“A growing number of rural poor in Cambodia are at risk of getting into a cycle of debt,” the report added.
“Disasters such as floods place them at even higher risk.”
The Flooding, which began in August along the Mekong and other key rivers, also destroyed more than 10 percent of the nation’s crops.
“Food shortages, in particular, are cited by many households as the main reason for taking out loans,” it said.
The number of households expecting food shortages for four to eight months has also increased from 13 percent before the floods to 31 percent after the floods, according to the report.
The report also found more than one in 10 households now have multiple loans, and frequently these additional loans – many from private moneylenders whose interest rates can be as high as 65 percent per annum – are used to pay back earlier loans.
“These results present sobering reading,” Bill Pennington, CARE’s acting country director for Cambodia, said in a statement.
“We know that poor families have suffered disproportionately during the flood emergency, and due to this we now know these same families have been forced into acute levels of debt in trying to rebuild their livelihoods and incomes.”
(Editing by Rebekah Curtis)
After losing farms, livestock and jobs in the floods, nearly half of all households interviewed were forced to take out an additional loan, the study conducted by CARE, Oxfam, Catholic Relief Services and Pact said.
“Large numbers of rural communities are currently relying on borrowing money to support farming and basic necessities,” said the report.
While farmers usually sought loans to finance agricultural inputs, the report found almost 25 percent of the loans are now being used to pay immediate costs such as food, health and education.
“A growing number of rural poor in Cambodia are at risk of getting into a cycle of debt,” the report added.
“Disasters such as floods place them at even higher risk.”
The Flooding, which began in August along the Mekong and other key rivers, also destroyed more than 10 percent of the nation’s crops.
“Food shortages, in particular, are cited by many households as the main reason for taking out loans,” it said.
The number of households expecting food shortages for four to eight months has also increased from 13 percent before the floods to 31 percent after the floods, according to the report.
The report also found more than one in 10 households now have multiple loans, and frequently these additional loans – many from private moneylenders whose interest rates can be as high as 65 percent per annum – are used to pay back earlier loans.
“These results present sobering reading,” Bill Pennington, CARE’s acting country director for Cambodia, said in a statement.
“We know that poor families have suffered disproportionately during the flood emergency, and due to this we now know these same families have been forced into acute levels of debt in trying to rebuild their livelihoods and incomes.”
(Editing by Rebekah Curtis)
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