Country Governance Risk Assessment and Risk Management Plan

This is the first country-level governance risk assessment and risk management plan (GRARMP) for Cambodia. It has been prepared using the Second Governance and Anticorruption Action Plan (GACAP II) of the Asian Development Bank (ADB) and its implementation guidelines. The assessment is risk-based and looks both at risk in relation to fiduciary matters and broader governance risks to achieving satisfactory development outcomes. The approach is based around three core governance areas: public financial management (PFM), procurement, and corruption. Over time, governance assessments of key sector risks and program and project fiduciary risks in Cambodia will be carried out following the GACAP II guidelines. The existing good governance framework (GGF) methodology (which was introduced in 2007 prior to adopting the Guidelines for Implementing GACAP II) in place for monitoring governance risks in ADB-financed projects in Cambodia is likely to be phased out. This governance risk assessment is one of the diagnostic studies prepared to inform ADB’s country partnership strategy (CPS) 2011–2013. It was developed concurrently with the CPS and discussed extensively with all relevant government stakeholders. To a large extent, approaches to mitigating major governance risks can only be successfully pursued if adequate resources and financing are provided. Thus, the recommendations of the risk assessment and risk management plan are related to future funding under the CPS.