CAMBODIA/AI: WORLD BANK PLANS TO FUND

UNCLAS SECTION 01 OF 02 PHNOM PENH 000955

SIPDIS

SIPDIS

STATE FOR EAP/MLS, OES/IHA DANIEL SINGER AND NATALIA
COMELLA, AND CA/OCS/ACS ELIZABETH RYAN
HHS FOR WILLIAM STEIGER, OFFICE OF INTERNATIONAL HEALTH
GENEVA FOR RMA
BANGKOK FOR ESTH--JIM WALLER AND DAN KIEFER

E.O. 12958: N/A
TAGS: AMED EAGR KFLU SENV CB
SUBJECT: CAMBODIA/AI: WORLD BANK PLANS TO FUND
COMPENSATION FOR CULLED BIRDS


1. SUMMARY. Prime Minister Hun Sen has agreed in principle
to a World Bank-funded effort to provide compensation for
culling birds in areas affected by confirmed cases of H5N1
avian influenza. The proposed program would compensate small
farmers approximately one dollar per bird; large commercial
farmers would not be eligible for compensation. Biosecurity
training would be available to all farmers in affected areas.
Given that Cambodian farmers typically rush to sell sick
birds before they die, an effective compensation program is a
critical part of the battle against avian influenza in
Cambodia. END SUMMARY.

World Bank Plan
--------------


2. During recent discussions between World Bank Animal
Health Officer Murray MacLean and Emboffs, MacLean reported
that the Prime Minister's office is sending encouraging
signals about a proposed World Bank plan to compensate
farmers for culled birds as a part of the Bank's
approximately USD 11 million Cambodia Avian Influenza
Emergency Project. The draft plan calls for small hold
farmers to receive 4,000 riel (approximately one US dollar)
per culled chicken or duck in accordance with pre-defined
criteria. These farmers, who typically have 5-20 head of
poultry, would also receive village-based bio-security
training. Large commercial farmers will receive no
compensation, but will receive bio-security training.
Compensation for small-scale commercial duck farmers (e.g.
those with 100-300 ducks in rural locations) is proving the
most difficult sticking point. While these farmers do not
typically have the financial resources to weather a culling
of their flock, the government remains concerned about the
financial implications of committing to compensation for
farmers with larger numbers of animals.


3. The RGC's position on compensation for culled birds has
been rather fluid, MacLean noted. Initially the government
refused to offer compensation, then said they would prefer
compensation with live chicks. Now, as a result of a visit
by the World Health Organization Regional Director and a
follow-up letter to the Prime Minister, the government has
agreed to cash compensation. Government officials reportedly
expressed frustration at donors who pressured the government
to compensate farmers without offering to fully fund such an
effort, fearing that they will be left holding the bag for
the program after donor funds dry up. They requested that
donors promise to fund a compensation system as long as avian
influenza remains in the country, but World Bank officials
have told them that this would not be acceptable. MacLean
noted that while one dollar per bird seems like a small
amount, the associated costs of running a culling
compensation program could be high. For example, the
on-going surveillance program needed to investigate suspected
avian flu cases and conduct the culling could run to USD 2-3
million per year.


4. A key component of the plan is the development of
criteria for the culling of birds in areas with a confirmed
H5N1 finding. Ministry of Agriculture officials will
determine how far culling should extend from confirmed
outbreaks. With these guidelines in place, more than 6,000
village animal health workers currently in place will explain
the procedure to farmers in an effort to alleviate concerns
about the program and encourage reporting of unusual die-offs
among poultry. (USAID and the German government are funding
training for all of the village animal health workers on
conducting awareness campaigns, building trust in a community
and encouraging the reporting of unusual poultry deaths,
taking specimens from suspected poultry, culling and proper
disposal of poultry, and using disinfectant spray. This
training began in November 2005, and 1,500 workers in high
risk provinces have already completed training.)


5. The total cost of the Cambodia Avian Influenza Emergency
Project is expected to be approximately USD 11 million over
three years, though MacLean noted that this could very well
be extended for a fourth year. Of the USD 11 million,
approximately USD 6 million will be devoted to animal health,
USD 3 million to human health, and USD 2 million to pandemic
preparedness activities. The World Bank is sending a Joint
Appraisal Mission to Cambodia from May 15-27 to formally

PHNOM PENH 00000955 002 OF 002


appraise the project, though post notes that the extensive
efforts and favorable findings of the pre-appraisal team make
it very likely that the project will be approved. Approval
is expected in late June, with activities beginning shortly
thereafter.

Comment
--------------


6. The World Bank and other multinational organizations'
efforts to tackle this tricky issue are laudable and deserve
US support. While there are legitimate concerns about cost
and the potential for corruption, such a plan is needed to
encourage farmers to report unusual poultry deaths. No
reports of unusual poultry die-offs preceded either of the
two human AI deaths that have occurred in the past two
months. Currently, Cambodian farmers rush their poultry to
market at the first sign of unusual deaths, hoping to
liquidate their assets before they die. While this strategy
makes sense in dealing with the relatively common Newcastle
disease--in which infected poultry can be safely consumed and
the virus is not transmittable to humans--it could prove
disastrous in the context of avian influenza. By focusing on
small farmers, the World Bank's plan avoids the potential for
large-scale corruption and targets those farmers who can
least afford uncompensated losses.
STORELLA