Sam Rainsy: Hun Sen must reign in corruption if he wants to see inflation decrease

Hun Sen Urges Curbing of Inflation

By Chiep Mony, VOA Khmer
Original report from Phnom Penh
30 May 2008

Prime Minister Hun Sen on Thursday called for his government officials to work to curb inflation that has seen the price of goods increasing daily.

The price of rice has reached 3,800 riel per kilogram and fuel 5,600 riel per liter at some stations, biting into the low salaries of many workers.

“I would like to appeal to all institutions of the government to try their best to carry out the measures being taken out in order to curb inflation,” Hun Sen said, speaking at a national conference on livelihood improvement.

The government has been facing inflation since mid-2007, he said.

Opposition leader Sam Rainsy said Thursday Hun Sen must reign in corruption if he wants to see inflation decrease.

Government vows to reduce inflation by end of 2008

Economist Sok Hach (Photo: EIC)

Wednesday, 07 May 2008
By Chun Sophal
The Mekong Times

Soaring inflation is a painful thorn in the side of Cambodia’s burgeoning economy, but government officials are trying to soothe concerns with assurances that inflation wil be under control by the end of 2008.

“We will reduce the inflation rate to single digits starting from the end of 2008 and into next year,” said Hang Chuon Narun, secretary general of the Ministry of Economy and Finance. He cited the government’s recent efforts to encourage agriculture sector investment, subsidize oil prices, and increase banks’ reserve capital as reasons why inflation would decrease.

Sok Hach, director of the Economic Institute of Cambodia, said that Cambodia would be unable to reduce inflation if open competition with products produced by various dominant Okhna groups is not allowed.

“The government has to decrease taxes on all goods in general and lift barriers to competition in trade,” he said. “I believe we can help reduce inflation to some extent if we have a competition law and implement it well.”

Cambodia, which currently has an inflation rate of over 10 percent, has yet to introduce a trade competition law even though it is a requirement for the Kingdom’s continued membership of the the World Trade Organization.

Economists say that the soaring inflation in Cambodia is partially due to the rising global oil prices, the devaluation of the US dollar and increasing international food prices. Internal factors such as high goods taxes and the lack of open product competition exacerbate the situation.

John Nelmes, International Monetary Fund resident representative for Cambodia, said increased cash flow in Cambodia is linked with the country’s inflation rate. “I think that increasing obligatory reserve funds to reduce growth is a positive step,” he said.

Early this year, the government paid out US$300 million in oil subsidies, US$41 million in electricity subsidies and cut taxes on imported agricultural materials in order to curb increasing prices.

Chhit Sam Ath, director of the NGO Forum on Cambodia, said inflation is a major problem severely affecting the nation’s poor.

“I believe government subsidies can help people,” he said. “I think the government should try its best to lower and stabilize inflation by dealing with the impact from both internal and international factors.”

Rong Chhun: "...if [Hun Sen] is unable to resolve this [inflation] issue, please rest [resign] and let a competent person resolve it"

Rong Chhun (L) and Chea Mony (R)

Unions Demand Solution to Inflation

By Chiep Mony, VOA Khmer
Phnom Penh
01 May 2008

“If [Prime Minister Hun Sen] is unable to decrease inflation, [he] must increase salaries for workers and civil servants ... And if [he] is unable to resolve this issue, please rest [resign] and let a competent person resolve it” - Rong Chhun, President of the Cambodian Confederation of Unions

Unions of workers and teachers hammered the government Thursday for its inability to curb rising inflation that is having a serious affect on their livelihood.

Thursday was International Labor Day, and unions for both groups urged factory owners to respect labor laws as well.

“If [Prime Minister Hun Sen] is unable to decrease inflation, [he] must increase salaries for workers and civil servants,” said Rong Chhun, president of the Cambodian Confederation of Unions, speaking to a gathering of 300 workers and teachers. “And if [he] is unable to resolve this issue, please rest [resign] and let a competent person resolve it.”

Chhea Peng Chheang, secretary of state for the Ministry of Economy and Finance, said inflation was caused by many factors, such as the impact of international markets and an increase in the global price of oil.

“The government has enough ability to resolve the issue,” he said, adding that the government was trying to improve the living conditions of all Cambodians, including the workers.

Free Trade Union President Chea Mony said factory owners must also respect the labor law or face mass demonstrations in coming weeks.

Teachers Request Double Salary

By Chiep Mony, VOA Khmer
Phnom Penh
21 April 2008

The Cambodian Independent Teachers Association on Monday requested a doubling of teacher salaries, as the cost of living continues to rise.

The price of consumer goods and fuel have put a strain on teachers, and a 20 percent raise would not be enough to cover the costs, the association said in a letter.

“If the government cannot lower the price of goods, the association asks it to double the salary of teachers to balance against the high price of goods,” said Rong Chhun, the association president.

Education Minister Kol Pheng could not be reached for comment.

Chea Se, undersecretary of state of the ministry, said he did not support the request.

“As a principle, we have to ask the government to help decrease the price of goods to balance with the salary,” he said.

The higher costs of living have put a bite on many of Cambodia’s poor, straining the already low wages of the nation’s educators.

The price of fuel reached 5,000 riel per liter Monday.

Chea Vannath, former executive director of the Center for Social Development, predicted a continued rise in the price of consumer goods following the price of fuel, thanks to the country’s dependence on imports.

We want half PRICE not half RICE!

Families in all ASEAN nations have been hit hard by rising food prices

ASEAN leaders prepare to battle inflation

Saturday, April 5, 2008
Source: Thanh Nien News and AFP

Finance ministers from 10 Asian countries Friday vowed to be vigilant in the fight against inflation, as soaring food and fuel prices threatens to spark public unrest in some nations.

The ASEAN (Association of Southeast Asian Nations) ministers, who met in Da Nang City, were searching for ways to cope with the global economic slowdown, as well as escalating prices, which has hit households across the region hard.

ASEAN economies had been feeling the effects of the economic slowdown in the United States as well as rising international food and oil prices, Vietnamese Deputy Prime Minister Nguyen Sinh Hung said at the opening session.

“These adverse externalities have resulted in increasing inflationary pressure, hurting the region’s growth rate - and Vietnam is no exception,” Hung said.

“However, with strong determination and dynamic adjustment of each country, ASEAN is set to overcome these challenges to achieve sustainable economic growth in the medium and long-term future.”

In a statement to close the annual meeting, finance ministers said they had discussed the potential for a much longer economic slowdown than expected.

“We remain vigilant against these risks and resolved to maintain sound fiscal and monetary policies, while

continuing to implement policies that will sustain domestic demand as an important anchor of growth,” they said.

Many experts believe the region will be able to weather the turmoil better than in times past, in particular during the 1997-1998 Asian financial crisis.

World Bank managing director Juan Jose Daboub told AFP there was cause for “cautious optimism” in the region despite the possibility that slowing demand in the US will undercut a major export market for the region.

The Asian Development Bank and the World Bank this week both reduced their growth forecast for the region, excluding Japan.

The World Bank said there could be an aggregate income loss of 1 percent of gross domestic product due to price increases.

In Da Nang Friday, finance ministers discussed the progress in the implementation of the Roadmap for Monetary and Financial Integration of ASEAN, the Asian Bond Markets Initiative and the Chiang Mai Initiative, as well as the realization of the ASEAN Economic Community.

“Since the adoption of the Roadmap for Monetary and Financial Integration of ASEAN in 2003, we have strengthened regional financial resilience and enhanced our capacity to manage risks,” Vietnam’s Finance Minister Vu Van Ninh said.

“We agreed that greater financial cooperation would enhance competitiveness and equity in ASEAN,” he said.

Delegates at the meeting also talked about the rising global commodities and energy prices.

They noted the importance to strengthen the regional initiatives on food security and energy security.

ASEAN ministers committed to liberalize key financial services sectors and implement the ASEAN Economic Community (AEC) Blueprint by 2015.

Responding to media’s question about whether ASEAN needs to set up a currency for the AEC, the Malaysian Finance Minister Nor Mohamed Yakop said the main target was to create an economic community for all ASEAN members, not to focus on setting up a general currency.

“We made some progress on the Chiang Mai Initiative, which aims to create a fund to prevent economic crises from denting ASEAN and plus-three countries, including China, Korea and Japan,” Vu Van Ninh said.

“The detailed plans of the initiative will be discussed at the meeting of ASEAN leaders in Madrid in May.”

ASEAN’s members are Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam.

ASEAN+3 also includes Japan, South Korea and China.

Teachers union asks for government intervention to rein in on inflation

Wednesday, March 12, 2008
Everyday.com.kh
Translated from Khmer by Heng Soy

Rong Chhun, President of the Cambodia Independent Teachers’ Association (CITA), asked the government to take measure to rein in on inflation. In an open public letter issued Tuesday, Rong Chhun wrote that, after the government increased the salary of government workers and teachers by 20%, the inflation rate is much higher than the salary increase provided by the government. In his letter, Rong Chhun wrote that, the price of gasoline alone has increased to 4,800 riels (~$1.20) per liter. Rong Chhun asked the government to take appropriate measure to rein in the ever increasing inflation. There is no reaction from the government yet on Rong Chhun’s open letter.

China steps in to curb inflation

January 12, 2008

China's cabinet says it will temporarily intervene in the market to curb rampant food and fuel price rises.

Retailers and producers will face heavy fines if they increase the price of basic necessities, the government says.

Food prices climbed more than 18% in November, while the price of pork jumped by more than 50%.

Inflation has traditionally been associated with civil unrest in China, and correspondents say the intervention shows the government is very concerned.

During the past 20 years, the Chinese administration has largely abandoned price controls, as the free market took hold across the country.

The price of basic essentials has increased hugely during this time, and families on low incomes - numbered in their hundreds of millions in China - currently spend between 30% and 50% of their income on food for the table.

According to the BBC correspondent in Shanghai, Quentin Sommerville, rising prices were the main concern among Chinese households last year, outranking worries over corruption and the growing wealth gap.

But economists are skeptical that the new rules will work, as price controls often lead to empty shelves.

And the UN's food aid agency is warning that another measure taken by China - restricting the exports of rice and other staples - could have serious effects in the region.

The World Food Program (WFP) says China's move, which followed similar restrictions imposed by India and Vietnam, could help to cause acute food shortages.

The WFP says North Korea, East Timor, Afghanistan, Bangladesh and Cambodia are particularly at risk.

Source: BBC