PM: Cambodia to maintain 6% economic growth in 2009 [... more of Hanoi PhD's promises]

SIEM REAP, Cambodia, Feb. 16 (Xinhua) -- Cambodia will try to maintain its economic growth at 6 percent in 2009, in context of the current global financial crisis, Cambodian Prime Minister Hun Sen said here on Monday.

The annual inflation rate is expected to drop to single digit this year, he said in a keynote speech for the one-day Business Roundtable, which was hosted by the Economists Conferences to discuss ways for the kingdom to secure sustainable economic development.

"During the last decade of peace and stability, Cambodia achieved high economic growth rate at around 9.4 percent per annum," said the premier in his speech named "Over the Verge of Breakthrough."

"Amazingly, economic growth reached 10.6 percent per annum over the last 5 years, with a peak at 13.3 percent in 2005," he said, adding that the rates stood at 10.8 percent in 2006, 10.2 percent in 2007 and 7.0 percent in 2008.

The inflation rate accelerated to more than 20 percent in the middle of 2008, but dropped to 19 percent at the end of year, he told hundreds of economists, businessmen, entrepreneurs and government officials.

Meanwhile, foreign currency reserves has doubled over the last 2 and half years from 1 billion U.S. dollars in 2006 to 2 billion U.S. dollars in 2008, he said.

The above achievement has helped reduced poverty by over 1 percent annually from 47 percent in 1994 to 30 percent in 2007, he added.

The Economic Conferences is part of the Economist Group, publisher of The Economist magazine, and remains a leading provider of highly interactive meetings, including industry conferences, management events and government roundtables, for senior executives to seek new insights into importance strategic issues.

One million Cambodians will be affected by the 2009 economic crisis [-Is Hun Sen willing to admit that Cambodia is not spared by the economic crisis?]

13 Feb 2008
By Ky Soklim
Cambodge Soir Hebdo
Translated from French by Luc Sâr
Click here to read the article in French

The worldwide economic crisis will not spare Cambodia. According to a study recently published, the number of unemployment will increase in 2009 in the garment and construction sectors. On the other hand, the agriculture and the tourist sectors may be able to absorb some these workers.

A report by the Cambodia Institute of Development Study (CIDS), which was made public last week, shows that the Cambodian economic growth should slow down from 6% in 2008 to 5% in 2009. Exports would drop by 2.5%, causing the kingdom to lose a revenue of $75 million. The number of tourists, while still on the increase, should increase at a slower pace, by 5.5% rather than the 15.7% increase seen in 2008.

This new economic data will most likely affect social issues. It will lead to a return of the unemployed to the countryside, or it could push them to migrate to Thailand (to look for work). “When people do not have work, and their knowledge is very low, they will be pushed to commit violence,” a concerned Chea Mony, President of the Free Trade Union of Workers in the Kingdom of Cambodia (FTUWKC), said. He also accused the government of being indifferent to the plea of unemployed workers.

ILO: 500,000 Cambodians hit by economic slump [-Cambodia's Strongman will never believe this, even if he can see it with his eye]

PHNOM PENH, Feb. 13 (Xinhua) -- Some 500,000 Cambodians have been affected by the global economic downturn, English-language daily newspaper the Phnom Penh Post on Friday quoted the International Labor Organization (ILO) as saying.

Another one million are expected to feel the pinch in 2009, said an ILO report of economic assessment of the kingdom.

ILO predicted 19,000 job losses in the garment sector and 25,600 in construction, as well as 5.1 percent growth in gross domestic products (GDP) in 2009.

Meanwhile, it urged the Cambodian government to take strong action to cushion the effects of the crisis, including establishing a central job information system, an unemployment program and a multi-sector trade union.

The Cambodian economy was estimated to grow by only seven percent in 2008 and the government is trying to maintain a six percent growth in 2009.

The International Monetary Fund (IMF) predicted 4.8 percent economic growth, while the World Bank has forecast 4.9 percent GDP growth for Cambodia in 2009.

IMF Predicts Little Growth in 2009

By Men Kimseng, VOA Khmer
Original report from Washington
09 February 2009

The International Monetary Fund forecasts that the world economy will recover by 2009 in some countries and 2010 in others. It also says that aid-dependent Cambodia will have only 4 percent economic growth in 2009.

The IMF said that the world economic crisis projects negatively in advance economies with -2 percent and some growth in emerging economies around 3.3 per cent. Those figures are the lowest the world has experienced in the post-war period.

Dominique Strauss-Kahn, Managing Director of the IMF, said: “We expect some recovery at the beginning of 2010; for some countries, end of 2009. Of course, those forecasts are very uncertain, and it depends a lot upon the policy which may be implemented today and in the coming months.”

Strauss-Kahn said that two factors will contribute to the recovery: the global economy, led by the US economy, and the European economy. Another factor is the big stimulus, both on the monetary side and fiscal side, being implemented by major Asian countries.

Hang Chuon Naron, Secretary General of the Supreme National Economic Council, said that the government of Cambodia has put in place some preventive measures, including extending a 2006 profit tax exemption for garment sector and focusing on building infrastructure as well as increase spending on some priority areas.

“We will do our best to ensure between 4 to 5 percent economic growth,” Hang Chuon Naron said. If we cannot go up to 7 percent, 5 percent is still high. Reaching 5 percent will be our great achievement.”

Cambodia still depends on international assistance for its development projects. In 2008 development partners pledged nearly one billion dollars.

“One thing that is very important and interesting in the Cambodian case is that they had rather high growth last year, but it was the first time for a very long period. So for political reasons, historical reasons, growth had been rather low, and then they had a very strong increase…and then this increase and this recovery has just been destroyed by the crisis,” said Strauss-Kahn warning that donors’ countries being in crisis making their willingness to help and the amount which can be used for foreign aid will decrease.

Kang Chandararoth, an economic analyst and head of the Cambodia Institute of Development Study, said Cambodia’s economic growth depends also on its investment partners.

“Whether Cambodia is out of economic recession or not depends on our economic partners,” he said. “Firstly, it is the United States that is our exporting partner. Secondly it is the recovery of our main investors, like South Korea, China and other Asian countries.”

Cambodia’s economic growth hit 7 percent in 2007.