Standard & Poor’s placed Cambodia as “extremely high risk” to external shocks

Credit rater places country at ‘high risk’ to external shocks

January 09, 2012
Neil Jerome C. Morales
Business World

THE PHILIPPINES is one of the countries in Asia-Pacific most vulnerable to external shocks, credit rater Standard & Poor’s said in a report.

“A severe deterioration in the global economy could sharply lower growth in Indonesia, Malaysia, Thailand, the Philippines and Vietnam in 2012 because these countries primarily depend on exports for growth,” Standard & Poor’s said in the Asia-Pacific Markets Outlook 2012 released yesterday.

“Some economies in the region, such as Singapore, Thailand, and the Philippines, rely heavily on export-driven income, and any slowdown in global growth may affect their economic growth,” it said.

In the 10 months to October, exports contracted by 4.3% to $41.294 billion from $43.15 billion the previous year, data from the National Statistics Office showed.

Hence, Standard & Poor’s placed the Philippines and Vietnam as “very high risk” and Cambodia as “extremely high risk.”

Standard and Poor's assesses Cambodian economic outlook as stable

Oct 9, 2008
DPA

Phnom Penh - Standard and Poor's declared the Cambodian economic outlook stable Thursday in an overall positive assessment in a sovereign report covering 21 Asia-Pacific nations.

The report, sub-titled As the Financial Storm Spreads, Major Uncertainties Loom, praised the government's economic strategies.

It noted that despite the fact corruption and a dependence on donors remained concerns, it considered the Cambodian People's Party national election win in July with an increased majority meant 'no change in its pragmatic and market-friendly direction was expected.'

However, the strong showing of the main opposition party, the Sam Rainsy Party, at the polls, grabbing 22 per cent of the vote, meant despite its dominance the ruling party remained accountable to voters and augured well for the democratic process, it added.

The global financial services and credit rating company awarded Cambodia its first sovereign debt rating of B-plus in 2007.

The B-plus rating is below investment grade status, restricting many institutional investors. However, Cambodia has since risen above nations such as Pakistan.

Standard and Poor's Thursday assessed Cambodia's outlook stable and said although 'inflationary pressures remain acute ... fiscal policy remains one of the credit strengths for Cambodia.'

Cambodia is expected to maintain real GDP growth of around 7 per cent into next year, according to the International Monetary Fund.

The report comes ahead of an IMF meeting in Washington October 10-13 which will gather the world's central bankers and finance ministers to discuss a global response to the world's financial crisis.