DPA
Phnom Penh - Double-digit inflation would not hurt the Cambodian economy overall but could have a dire affect on the country's millions of poor, a World Bank economist said Tuesday. Like most of East Asia and the Pacific, Cambodia had been badly hit by inflation with the year-on-year rate at the end of 2007 reaching a nine-year high of 10.8 per cent, Huot Chea said.
However, the bank said Cambodia's economy continued to grow rapidly with gross domestic product (GDP) up an estimated 9.6 per cent last year.
"High inflation rates will not pose a serious threat to the Cambodian economy but will impact on the poor," Chea told journalists.
"About 25 per cent of poor people spend 70 per cent of their income on food," the economist said. "As long as food prices keep rising, this will automatically impact on the poor."
He said inflation had pushed the price of the national staple, rice, up so far that what would have once bought 3 kilograms in some cases now just bought 1 kilo.
Hikes in international oil prices, which have put the cost of petrol up to 1.25 dollars a litre in a country where millions earn less than a dollar a day had also contributed, he said.
The bank also expressed concern about Cambodia's growing trade deficit, which it estimated would grow from 6.8 per cent to 7.3 per cent of GDP this year.
However, overall, it said Cambodia's economy was in good shape and was mainly being impacted by outside factors, including the rising world price of oil and the crisis in the US economy.
"Although risks have increased, economic prospects for 2008 remain strong," the bank said in a press release.
However, the bank said Cambodia's economy continued to grow rapidly with gross domestic product (GDP) up an estimated 9.6 per cent last year.
"High inflation rates will not pose a serious threat to the Cambodian economy but will impact on the poor," Chea told journalists.
"About 25 per cent of poor people spend 70 per cent of their income on food," the economist said. "As long as food prices keep rising, this will automatically impact on the poor."
He said inflation had pushed the price of the national staple, rice, up so far that what would have once bought 3 kilograms in some cases now just bought 1 kilo.
Hikes in international oil prices, which have put the cost of petrol up to 1.25 dollars a litre in a country where millions earn less than a dollar a day had also contributed, he said.
The bank also expressed concern about Cambodia's growing trade deficit, which it estimated would grow from 6.8 per cent to 7.3 per cent of GDP this year.
However, overall, it said Cambodia's economy was in good shape and was mainly being impacted by outside factors, including the rising world price of oil and the crisis in the US economy.
"Although risks have increased, economic prospects for 2008 remain strong," the bank said in a press release.
10 comments:
Why do they keep changing the inflation figure, 10.8%? I never heard of that before. It was reported about 6.5% not long ago.
In any case, 10.8% inflation and 9.6% growth means we are only 1.2% behind, which is still not so bad. However, this year will not be easier with the rice price issue starting early on, but we have plenty of times to the end of the year to hack it. May God help us.
Don't rely on God because he can't do anything, even if you believe in God. Economics is entirely man-made.
Wrong, without God, there is no such thing as Cambodia today.
It is the proof that the liberalism is bad.
In the wild capitalism,
the rich crushes the poor man,
the powerful crushes the weak,
the employer exploits the workers!
Down with the capitalism!
Down with the liberalism!
Long live to the socialism-Marxist.!
Yeah, but then everyone end up being poor.
You stupid know that why Soviet was disapear? Or your stupid Vietyoun professor Ah sok kong never told?
To 11:45PM
"10.8% inflation and 9.6% growth means we are only 1.2% behind"
Do you even know what the hell are you talking about? Ahahhahhahahh!
some of us are psychos here... This is not the blog page for a jerk.
Yes 3:34, I know what I was talking about, and you?
I've heart it through the grapewine that sorcerer's apprentice pretends things are going right.
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