This paper analyses how the relationship between NGOs and Khmer farmers has changed in the process of a rural development project in Cambodia. The purpose of this study is to conduct a critical review of the social business of NGOs, which are attracting attention in the international development sphere by using gift-exchange theory.
In recent years, social enterprises have been attracting increasing attention by trying to solve intractable global social issues not through charity or volunteer work but through the application of business principles for sustainable development. Companies that maximize their profits and NGOs and UN development agencies that help others and solve social issues have been understood as occupying different domains and possessing different organizational cultures. However, these days the gap between these two different realms is narrowing and they are being integrated into the area of international development.
A leading NGO of participatory rural development, which is regarded as a successful case of rural development in Cambodia, established a social enterprise company and started an agribusiness there. This project, which started in a rural village in southern Cambodia in 2001, is different from most projects in this country where top-down development based on patron-client relations is mainstream. This new paradigm was expanded to other provinces and then nationwide. Later, NGOs launched social enterprises to sell crops produced by organic farming, both domestically and outside the country. During the development of the project, what started as a good relationship between NGOs and farmers changed significantly over time, leading to some farmers abandoning the project.
Behind the movement are the differences between traditional business practices and the new business practices introduced by NGOs, and differences between the concept of “NGO” and “business” in the local community. For local people, NGO activities and social relationships with staff have traditionally been in the gift-exchange sphere. However, with the commercialization of NGOs, their activities and their relationships with their staff changed to a market-exchange relationship, creating doubt and confusion, and causing a number of disenchanted farmers to leave the project.
This paper discusses the commercialization of NGOs, which is regarded as aiming to achieve sustainable development, in the sociocultural context of Cambodia. The author points out that projects implemented for sustainable development can lead to unintended consequences that can cause farmer defections.
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