Navigating Through Crisis

This chapter provides an overview of the COVID-19 pandemic, its socio-economic impacts, and policy responses in Cambodia, Lao PDR, Myanmar, and Vietnam (collectively referred to as CLMV). It presents how the pandemic affected key sectors and heightened existing vulnerabilities, particularly among women, migrant workers, and those in the informal sector. While the impacts varied across countries, common challenges emerged. This introductory chapter sets the stage and provides the rationale for the subsequent in-depth explorations of the socio-economic effects of the COVID-19 pandemic across CLMV countries.

The COVID-19 pandemic has severely disrupted global economic activity, impacting Cambodia’s trade dynamics, weakening its integration into global value chains, and undermining export competitiveness. This chapter assesses the pandemic’s effect on Cambodia’s trade landscape, focusing on shifts in export structure, supply chain disruptions, and changes in comparative advantage. The analysis reveals that while Cambodia’s total exports contracted, certain sectors—including agricultural products, rubber, footwear, and transportation equipment—demonstrated notable resilience. Conversely, service exports, particularly in tourism and transport, experienced severe declines. The gravity model analysis highlights how Cambodia’s machinery supply chains were disrupted by the pandemic, showing sensitivity to both domestic and international COVID-19 conditions. Additionally, the study’s analysis of revealed comparative advantage presents a mixed picture, with some sectors losing competitiveness while others, notably in agriculture and machinery, enhanced their global standing. These findings highlight the urgent need for Cambodia to diversify its export markets, increase value-added activities, and strengthen regional economic partnerships to build resilience against future global disruptions. The chapter concludes with policy recommendations aimed at fostering a robust and diversified trade sector, essential for Cambodia’s economic recovery and sustainable growth in the post-pandemic world.

Although the agriculture sector in Cambodia was initially considered less vulnerable to the COVID-19 pandemic, cassava farmers experienced severe economic hardship due to the increase in input prices, fluctuations in output prices, and challenges in infrastructure development. However, these aggregate impacts hide the disproportionate repercussions faced by cash crop farmers, who were more severely affected by public health restrictions and market disruptions. Using data from 301 cassava-farming households across five major cultivation provinces, this study examines the pandemic’s impact on production, labor productivity, and labor participation in Cambodia. Although the price of fresh cassava slightly increased and the price of cassava chips remained stable, farmers lost income due to the increase in input prices and the fall in productivity. Between 2019 and 2021, average production costs rose by 9.3%, while income declined by 8.5%. Despite expanding cultivated land and increasing hired labor, overall productivity decreased. These findings underscore the vulnerability of Cambodia’s cassava sector to external shocks and highlight the need for targeted policy interventions. The paper concludes with actionable recommendations to enhance value addition, strengthen domestic markets for cassava products, and support a resilient post-pandemic recovery.

The COVID-19 pandemic significantly impacted Cambodia’s economy, leading to a contraction of -3.1% in 2020, with sharp declines in the service and industry sectors. Cambodian businesses, particularly small and medium enterprises, faced considerable turmoil while already grappling with challenges. This study examined firm performance—including expenditure, profits, revenues, and employment—and investigated the strategies firms employed during crisis periods such as the pandemic. It draws on original firm-level survey data from 361 enterprises in the industry and service sectors, conducted in mid-2022. The findings show that most firms experienced rising expenditures, low revenues, and reduced profits between 2019 and 2021. Employment slightly increased in services in Phnom Penh but declined significantly in provinces. Firms reported low investment in skills development and innovation, with few employees participating in training. Telecommunication and internet access were perceived as major operational barriers. Most firms lacked business networks and access to financing, with 66% identifying financial access as a key constraint due to the complex lending procedures and unfavorable credit conditions. The study recommends targeted business support, skills development, crisis management strategies, infrastructure development, and greater engagement with industry actors to strengthen firm performance.

This study estimates the impact of the COVID-19 pandemic on the tourism sector in Lao PDR by analyzing changes in employment and value-added. Utilizing secondary data from the Lao Labor Force Survey and quarterly economic reports, the research applies econometric techniques to quantify sector-specific effects. The findings indicate that 39.5% of workers in the tourism sector experienced employment-related disruptions due to COVID-19, with 88.8% facing reduced working hours or job cessation. The total income loss among tourism workers is estimated at LAK 48.5 million per person, highlighting the sector’s vulnerability. Econometric results suggest that workers in the tourism sector were 12.4% more likely to be affected by the pandemic and experienced a 103.6% greater decline in income compared to those in other economic sectors. In terms of value-added, the accommodation and restaurant subsectors experienced a sharp decline of 87.9%, while the transportation sector was comparatively less affected, with a decline of 4.3%. These results underscore the need for targeted policy interventions to support recovery and resilience in Lao’s tourism industry.

In response to the COVID-19 pandemic, Laos must adapt to a “new normal” in both economic and social contexts. One of the most significant changes has been the increasing prevalence of e-commerce. Following the government’s relaxation of COVID-19 restrictions and the reopening of international borders in May 2022, this study aims to assess the development of cross-border e-commerce in the post-pandemic period. Employing a cross-sectional research design, this study draws on desk research and qualitative data to meet its objectives. The COVID-19 pandemic and related travel restrictions have significantly accelerated the growth of the e-commerce sector. Broadly, the e-commerce market in Laos can be divided into domestic and cross-border segments. Numerous factors, including the expansion of logistical providers and improved access to mobile banking services, have contributed to the growth of domestic e-commerce. Similarly, international e-commerce has been supported by the availability of debit/credit card services, international freight forwarding, and digital payment systems. Despite these developments, the findings reveal that e-commerce in Laos continues to operate largely within informal structures. Based on the results, the study provides policy recommendations aimed at formalizing and strengthening the e-commerce ecosystem to support sustainable economic development.

The COVID-19 pandemic profoundly disrupted Myanmar’s garment industry, a critical sector for employment, particularly among women. This paper examines the impact of the pandemic on garment workers in Myanmar by analyzing employment disruptions, income loss, gendered effects, and the role of social protection. Employing a mixed-methods approach, data were collected via phone interviews with 610 workers, 19 key informant interviews, and 4 focus group discussions across major industrial zones. Findings indicate a 26% decline in employment and a 23% drop in total wage bills between December 2019 and June 2020. Overtime hours were significantly reduced—by 59% in garment factories and 69% in footwear and bag factories. Women disproportionately shouldered domestic burdens, with over half reporting responsibility for cleaning and food preparations, compared to fewer than 10% of male spouses. Severance payments were inconsistently provided and often fell below legal thresholds, driving many into high-interest debt. Migrant workers faced additional barriers to access food and cash assistance. The pandemic exposed structural weaknesses in Myanmar’s labor protections and social safety nets. Key policy recommendations include enforcing labor laws on severance pay, expanding unemployment benefits, offering skills training, and improving GBV prevention and response mechanisms. These measures are essential to support garment workers’ well-being and facilitate equitable recovery.

This paper investigates the unexpected growth and resilience of Myanmar’s maize value chain during the COVID-19 pandemic, a period marked by economic disruption and volatility in global agricultural markets. Despite widespread challenges, Myanmar’s maize exports surged by 150%, driven by sustained demand from neighboring ASEAN countries, particularly China and Thailand. This growth positioned Myanmar as a key regional supplier of livestock feed. However, the sector faced significant challenges, including non-tariff barriers, border closures, logistical disruptions, and strict export licensing requirements. These barriers underscored Myanmar’s dependency on informal trade routes with China, leaving the sector vulnerable to sudden regulatory changes and seasonal closures. In response, the maize value chain rapidly adapted, pivoting trade toward alternative ASEAN markets. New trade pathways, particularly with Thailand, were facilitated by geographic proximity, competitive pricing, and flexible production practices by smallholder farmers. These farmers demonstrated agility in adjusting planting cycles and trading strategies, reflecting the importance of maize as a cash crop for rural livelihoods. The sector’s resilience also reflected alignment with ASEAN’s agricultural trade demands and the potential for deeper regional integration. This study, drawing on stakeholder interviews and regional trade data, underscores the necessity for Myanmar to address infrastructure gaps, enhance quality standards, and formalize trade channels. Policy recommendations focus on improving logistics, fostering public–private partnerships, and strengthening cross-border trade policies to support the sector’s sustainable growth. This case offers broader insights into how emerging agricultural economies can navigate global shocks through adaptive strategies and regional cooperation.

The COVID-19 pandemic has had profound impacts on the Vietnamese economy, with particularly severe consequences for the textile and garment industry and the hospitality sectors. This paper draws on data from a nationally representative phone survey conducted in 2021, encompassing 998 households, as well as a follow-up survey in 2022 that re-interviewed 777 of those households. The study focused on households with members employed in the aforementioned sectors between May and July 2021. The findings reveal notable gender disparities in the socioeconomic impact, particularly in relation to employment, income loss, and unpaid care responsibilities. One year after the onset of the crisis, many households, especially female-headed ones, continued to experience economic hardship, with income recovery lagging behind employment recovery. Women continue to bear a disproportionate burden of unpaid care work, underscoring persistent gender inequalities. This study calls for the urgent need for gender-responsive policy interventions that recognize and address these disparities, including enhanced support for unpaid care work, improved fiscal sustainability of social transfer programs, and the integration of citizen data through digital platforms to facilitate inclusive and equitable recovery.

This study examines the impacts of the COVID-19 pandemic on young female migrant workers (aged 18–35) who returned to their hometowns in Thua Thien Hue province, Central Vietnam. Utilizing a mixed-methods approach—including surveys with 110 participants, in-depth interviews, and discussions with local authorities—the research reveals how these women faced multi-faceted challenges such as employment instability, discrimination, psychological distress, and limited access to opportunities due to limited education and skills. The pandemic significantly disrupted their livelihoods, particularly for self-employed workers, causing financial hardship and increased household stress. Despite these challenges, the majority of women expressed a desire to re-engage in migrant work for income generation. The study underscores the need for targeted post-pandemic policies that promote skill development, facilitate job placement, encourage social security enrollment, and raise awareness of financial literacy. Additionally, the research emphasizes the importance of providing accessible psychological support services to enhance the resilience among this vulnerable group.

The experiences of Cambodia, Lao PDR, Myanmar, and Vietnam offer several lessons for the pandemic’s responses. First, economic diversification and innovation improved resilience to the shocks. Second, timely public health actions lessened the pandemic’s adverse effects. Third, the pandemic revealed social protection gaps, especially for migrant and informal worker populations. Fourth, effective pandemic mitigation required regional and international cooperation. Looking ahead, strengthening public health infrastructure, enhancing fiscal space, and promoting inclusive and sustainable development will be essential to improving crisis readiness.