Cambodia's inflation hits record 22 percent [... and this is just the official number, in reality it may be much higher]

Tuesday, September 09, 2008

PHNOM PENH (AFP) — Cambodia's inflation hit a record high of 22 percent in July, a government minister said Tuesday.

Planning Minister Chhay Than said high global prices of oil and food were to blame for the soaring rate.

"For July, the inflation rate was 22 percent. We can say that this is a record high," Chhay Than told AFP.

"The inflation is caused by outside factors... the prices of oil, fuel and foods... the slowdown in the US economy," he said.

"But if we compare with some neighbouring countries, it is not so high," Chhay Than added.

The last published consumer price index (CPI) for January showed that inflation had reached 18.7 percent.

The government then stopped releasing monthly CPI reports in a move widely seen as an effort to hide spiralling consumer costs ahead of July elections, in which Prime Minister Hun Sen's ruling party stormed to victory.

Officials denied that claim, saying there had been a disagreement over how to calculate the figure.

The government has now said it will resume publication of inflation figures later this week.

Cambodia in May doubled reserve requirements for private banks from 8.0 percent to 16.0 percent in a bid to curb money supply and stem rising inflation. The requirements took effect from July.

Hun Sen's gov't: Inflation rate dropping ... it's "only" 22% now -sic!-

A Phnom Penh rice trader Sunday. The price of staples skyrocketed in recent months, prompting the government to suspend the publication of inflation figures. (Photo: TRACEY SHELTON)

CPI data to resume this week

Monday, 08 September 2008
Written by Thet Sambath and Chun Sophal
The Phnom Penh Post

Opposition blasts government claim of lower inflation rate

MINISTRY of Planning officials announced a decrease in Cambodia's inflation rate to 22 percent in advance of official Consumer Price Index numbers expected later this week.

The government suspended monthly CPI reports in early February in a move widely seen as an effort to obscure spiralling consumer costs ahead of the July national polls.

"The ministry has completed the Consumer Price Index and inflation was at 22 percent in July and August," Minister of Planning Chhay Than told the Post Sunday.

"These figures show that inflation has gone down compared to the same period last year," he said.

The minister said the drop was explained in part by falling petrol prices.

However, Sam Rainsy Party parliamentarian Son Chhay dismissed the government's inflation assessment.

"I think the ministry shouldn't release statistics for politically motivated reasons. The election is over, so they should give us the real numbers," he said.

He said the figure of 22 percent doesn't correspond to actual market costs for goods, which he says have gone up no less than 30 percent over the past six months.

The National Bank of Cambodia said last month that inflation for the first half of the year rose to 25.1 percent.

San Sithan, director general of the Ministry of Planning, told the Post Sunday the government will adopt a new model for calculating the CPI some time near the end of the year.

"It will be in place by the end of this year," he said, adding that there would be only minor differences between the two.

"We are seeing a decrease in inflation because petrol prices have dropped, and that has driven down the price of other goods and services," San Sithan said.

Inflation in January 2008 - the last month government data was available - stood at more than 18 percent.