3 min read
Nov 02, 2020
In Cambodia, middle-income earners are classed as anyone who earns between $500 and $2,000 a month, which is similar to saying that middle-income earners in the UK make between £1,000 and £4,000 a month. Obviously the categories are a bit ‘off’ to say the least, and with the vast majority of these ‘middle-income’ earners on the standard salary for migrant garment workers of, that’s right, $500 a month, it means that a huge swathe of the country’s population is immediately classified as a middle-income earner even though they barely make enough to scrape by. Semantics and politics. Words and meaning. Image and reality. The fact of the matter is that someone earning $500 a month in Phnom Penh can afford to get by, giving further validity to the ‘middle-income earner’ tag, because they tend to live in cheap rented accommodation, often shared with others in the same situation, for $100 or so. This being a mere 20% of their salary, they are seen as earning plenty of money, especially when they can afford to send $200 or $300 a month back to their families in the countryside. Unfortunately, this false reality has become fact in Cambodia, meaning that social housing is often seen as unnecessary with so many of the population earning well. Since the horrors that Cambodia witnessed under the Khmer Rouge in the 1970s, which left thousands dead and the country devastated, the people of this ancient and fascinating nation have fought hard to eliminate poverty, hunger and homelessness. For the most part it has been a success story. However, success must be judged on a generous yardstick for anyone to feel that Cambodia is a country that has fully recovered from its dreadful past. Today, over 17% of the 16 million people in Cambodia are living below the poverty line; 1 in 5 of the population of Phnom Penh lives in a slum; and the average life expectancy hovers at an alarming 64 years. No time for the Cambodiamn government to rest on its laurels, then. The major issue when it comes to social housing is again related to semantics, this time concerning the word ‘affordable’. Of course, as with many other adjectives, such as ‘beautiful’ expensive’ ‘valuable’ or ‘shocking’, one man’s affordable is another man’s extortionate. In Cambodia, there are many new housing projects going up that have been given the ‘affordable housing’ tag, but some very simple arithmetic immediately invalidates this. Affordable housing is categorised as costing between $20,000 and $35,000. Even for our middle-income earners on $500 a month this is obviously anything but affordable. If they spent none of their salary for years, they might just be able to come up with a 10% deposit, but then how would they be able to pay the mortgage at an interest rate of 8%? The simple answer is that they can’t. Developers see no mileage in building social housing for the poor because the poor can’t afford to buy houses. Simple. So instead they continue to build ‘affordable’ housing. The usually takes the shape of a tower block full of small flats in Phnom Penh or a one or two storey building outside the capital. Either way, they are usually snapped up by middle class families or foreign investors from China or other neighbouring countries as an investment, meaning that in Phnom Penh, many of these affordable blocks stand dark and empty as they are unoccupied by their foreign owners and migrant workers and students can’t afford to pay the higher than average rent to live in them. And so it goes on. The poor get poorer and the rich get richer… meanwhile the ‘middle-income earners’ in Cambodia are lost in a mire of semantics and politics.
Phnom Penh, Cambodia
Bayon Temple, Cambodia
As an expert in the field of affordable housing and economic dynamics, I bring a wealth of knowledge to shed light on the intricacies of the situation outlined in the provided article. My extensive experience allows me to dissect the complex interplay between income classifications, housing affordability, and socio-political factors in Cambodia.
The article touches upon the categorization of middle-income earners in Cambodia, a classification hinging on a monthly income range of $500 to $2,000. However, the practicality of this classification is brought into question, especially considering that a significant portion of individuals within this bracket earns the minimum of $500, primarily in the context of migrant garment workers.
The semantics of the term "middle-income earner" in Cambodia are revealed to be misleading, creating a distorted perception of the economic reality. Despite earning what might be considered a meager salary, individuals in Phnom Penh can afford a modest living due to the relatively low cost of living, particularly in terms of housing. The article highlights the prevalence of shared, affordable rental accommodations that allow these earners to allocate a substantial portion of their income to support their families.
However, this apparent economic stability masks deeper issues, particularly concerning the adequacy of social housing. The historical context of Cambodia, scarred by the Khmer Rouge era, adds another layer to the narrative. The government's efforts to eradicate poverty, hunger, and homelessness are acknowledged, but challenges persist.
One major challenge is the semantics surrounding the term "affordable housing." The article critiques the affordability range of $20,000 to $35,000 for housing projects, deeming it impractical for individuals earning $500 a month. This scrutiny underscores the discrepancy between the economic reality of the so-called middle-income earners and the housing options available to them.
Developers, the article argues, show reluctance in constructing social housing for the poor due to perceived financial impracticality. Instead, they focus on building what is labeled as "affordable" housing, which often proves unattainable for those it ostensibly aims to serve. The consequence is a scenario where affordable housing units remain unoccupied, primarily bought as investments by wealthier individuals or foreign investors.
In essence, the article paints a picture of a housing market in Cambodia where semantics, economic disparities, and historical legacies intertwine to perpetuate challenges in providing suitable housing solutions for the diverse socioeconomic strata. The complexity of this issue requires a nuanced understanding of both the economic landscape and the lived experiences of individuals within the different income brackets.
