PHNOM PENH, May 8 (Reuters) - Cambodia's economy is expected to contract by 1 percent this year because of the global economic slump, but it will grow by 3 percent in 2010, the World Bank said on Friday.
Cambodia's economic growth has accelerated over the past decade since the end of the country's civil war, thanks to exports of garments to the United States and European Union, a boom in tourism and bountiful agricultural production.
But growth fell back to 5.5 percent in 2008 and now a contraction is likely because the global crisis has hurt garment exports, which brought in $2.78 billion in 2008 as the main currency earner, and caused the number of tourists to drop.
'Net exports will slow with overall global trade volumes as well as through market share losses in Cambodia's main export market of the U.S.,' the World Bank said.
Household consumption, incomes, employment and private investment, including foreign direct investment (FDI), were all slowing, it said.
Huot Chea, an economist at the World Bank in Phnom Penh, forecast FDI at just $390 million in 2009 after $790 million last year, but he expected an increase to $500 million in 2010.
The number of tourist arrivals dropped 2 percent in the first two month of 2009 compared with the same period last year, the report said, adding that occupancy rates in major hotels were well below 40 percent.
However, the government was taking action to mitigate the economic downturn, including credit for farmers, training for laid-off workers and other expenditure programmes, he said.
(Reporting by Ek Madra; Editing by Alan Raybould)
Cambodia's economic growth has accelerated over the past decade since the end of the country's civil war, thanks to exports of garments to the United States and European Union, a boom in tourism and bountiful agricultural production.
But growth fell back to 5.5 percent in 2008 and now a contraction is likely because the global crisis has hurt garment exports, which brought in $2.78 billion in 2008 as the main currency earner, and caused the number of tourists to drop.
'Net exports will slow with overall global trade volumes as well as through market share losses in Cambodia's main export market of the U.S.,' the World Bank said.
Household consumption, incomes, employment and private investment, including foreign direct investment (FDI), were all slowing, it said.
Huot Chea, an economist at the World Bank in Phnom Penh, forecast FDI at just $390 million in 2009 after $790 million last year, but he expected an increase to $500 million in 2010.
The number of tourist arrivals dropped 2 percent in the first two month of 2009 compared with the same period last year, the report said, adding that occupancy rates in major hotels were well below 40 percent.
However, the government was taking action to mitigate the economic downturn, including credit for farmers, training for laid-off workers and other expenditure programmes, he said.
(Reporting by Ek Madra; Editing by Alan Raybould)
5 comments:
The cambodian economy upturn will depend on the china , korea and the us economy. The 2 percent fall in tourism is a "fantasy" figure. More likely in the 20 percent bracket. remember the majority of tourists were from korea .
Pray that the poor will survive this ceisis until better times.
The comments from 4:06 PM are accurate. The World Bank report was prepared before it was known that so many U.S. banks were failing their "stress tests."
Uncle Hun Sen said, "Cambodia is shield from globalization financial crisis!"
Hun Sen, the PHD of economy expert in Khmer realm.
American economic is not recover yet! and who know when?
Would the merican go spending right away after it get a job? It may need a while, dude!
Will China , Corea and any one else would put ant investment in other country where there is opportunity in their own country?
Whoud any less than stupid investers buy a property in Hun Xen's coutry at the same price in New York? Whit two different returnes and security?
Do not bull-Shit! scratch your one real eyes Hun Xen!
The only PHD HUN SEN know is made him self rich.
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