WEEKLY ECONOMIC UPDATED

Updated: 01 Jun-07 Jun,2019

 

TRADE & COMMERCE | Nike Reaffirms Commitment To Cambodia

Global sportswear manufacturer Nike Inc. on Wednesday reiterated its commitment to producing in the Kingdom and praised the country’s progress in improving labour conditions. Speaking during a meeting with Minister of Commerce Pan Sorasak, Nike vice president Chris Helzer said the company feels optimistic about the Kingdom’s economic outlook and its compliance with international labour laws, particularly in the garment and footwear industry. Mr Helzer praised the government for its efforts to improve labour conditions in the garment sector and adhere to international laws regulating it. “Cambodia now enjoys high compliance with international labour standards through factory monitoring programmes, which are implemented as a partnership between the government and the private sector,” Mr Helzer was quoted as saying in a ministry press release. (Jun 07, 2019 | Khmer Times)

TRADE & COMMERCE | US-China Trade War Not Affecting Cambodia, For Now

The Minister of Economy and Finance said last week that the trade tensions between the United States and China have not had a negative impact on the Cambodian economy yet, but warned that a protracted trade war could hurt the Kingdom.​​ Cambodia has yet to feel the negative effects of the US-China trade war, Minister Aun Pornmoniroth said Friday during a meeting with the EU-Asean Business Council. Far from being adversely affected, Cambodia has been helped by the trade war, which has helped expand its export markets while increasing foreign direct investment flows into the country, the minister said. “Trade tension could create opportunities for developing countries such as Cambodia, expanding our export markets and attracting more FDI,” he said. (Jun 04, 2019 | Khmer Times)

TRADE & COMMERCE | Chinese-Invested Sihanoukville SEZ Is Model For SEZ Development

Chinese-invested Sihanoukville Special Economic Zone (SSEZ) is a model for the development of Special Economic Zones in Cambodia, Cambodian Deputy Prime Minister Hor Namhong told Xinhua in an interview. “I think this special economic zone is a model for the special economic zones in Cambodia because it has many factories, 161 factories, creating jobs for more than 20,000 Cambodian workers,” Namhong said after a visit to the SSEZ. “This special economic zone has good features such as canteens for workers, places to train various skills for workers, and dormitories for workers,” he said. The deputy prime minister said the SSEZ also has a single window office for communication between companies in the industrial zone and the customs and tax offices. (Jun 01, 2019 | Khmer Times)

TOURISM | Bong Thom: The Homestay Giving Insight Into Century-Old Heritage

On the way to Siem Reap’s tenth-century temple Banteay Srei is a more than 100-year-old structure now serving as an authentic Cambodian homestay for tourists, giving them an insight into a bygone era. Bong Thom Homestay features three types of traditional Khmer structures; the 85-year-old ‘rural tycoon’s house’, the 88-year-old ‘patron house’ and the 119-year-old ‘almshouse’. The homestay’s owner, Sou Say aka Bong Thom, tells The Post: “I decided to create a Khmer house homestay, aiming to develop and preserve old houses by buying and refurbishing them in the same style.”  Even though the wooden almshouse is more than century old, its columns remain strong and its decor refined after a renovation in 2010 that was respectful to the original design. The one modern addition is a swimming pool for guests.  (Jun 06, 2019 | Phnom Penh Post)

FINANCE AND BANKING | ANZ Royal Bank To Change Name

J Trust plans to rename ANZ Royal once it assumes a majority stake in the bank, the CEO of the Japanese company recently revealed. The company’s president and CEO, Nobuyoshi Fujisawa, told Cambodian Prime Minister Hun Sen that J Trust, who will soon hold a majority stake in the Cambodian bank, is planning to rename it ‘J Trust Royal Bank’ in August. The meeting between Mr Fujisawa and Mr Hun Sen took place in Tokyo on Thursday during the Cambodian Prime Minister’s visit to Japan to attend the 25th International Conference on the Future of Asia.  Mr Hun Sen welcomed the move and applauded the firm for deciding to invest in the Kingdom. (Jun 03, 2019/ Khmer Times)

FINANCE AND BANKING | ABA Announces Plans To Issue Bonds

ABA Bank, a member of the National Bank of Canada Group, plans to issue corporate bonds in the Cambodian capital market, which will make it the first banking institution to do so. The bank said Friday in a press release that it will submit today the disclosure documents needed to proceed with the issuance. ABA Bank recently obtained approval from the National Bank of Cambodia to begin the process of issuing corporate bonds in the Cambodia capital market, according to the press release. SBI Royal Securities is acting as the sole financial advisor and underwriter for the landmark transaction, it added. Seng Chan Thoeun, managing director and head of corporate finance at SBI Royal Securities, said the bank plans to raise $25 million from the issuance. Each bond will be priced at $25, he said. (Jun 03, 2019 | Khmer Times)

AGRICULTURE | Cambodia Underinvesting In Agriculture Research, ADB Says

The Asian Development Bank (ADB) said that Cambodia is underinvesting in agricultural research which may impede the development of the sector. In a report published by ADB’s Independent Evaluation Department, the institution found out that sectors like tourism and garments are being prioritised over agriculture. Despite this, the bank said agriculture continues to play a critical role in economic growth and poverty eradication in the country. Cambodia is one of four case studies in the report, which also looks at Bangladesh, China, and Tajikistan. The study aims to evaluate ADB’s support for agriculture, natural resources, and rural development in 2005-2017 in these countries. (Jun 07, 2019 | Khmer Times)

AGRICULTURE | Hun Sen Urges Rice Farmers To Quit Chemicals

Prime Minister Hun Sen yesterday urged rice farmers to abstain from using chemical fertilizers, arguing that Cambodian rice’s appeal abroad is that it is grown using organic techniques. Speaking during a university graduation ceremony, the premier complained that more and more local farmers are choosing to use chemicals to boost yields and make crops grow faster. He said this is causing Cambodian rice to lose its appeal. “Our paddy and milled rice are competitive within the Mekong sub-region. All countries in the Mekong sub-region produce similar types of rice – Myanmar, Laos, Thailand, and Vietnam all produce similar rice. “Cambodia differentiates itself by not using chemical fertilizers and pesticides. There is strong demand for milled rice without chemicals,” Mr Hun Sen said. (Jun 07, 2019 | Khmer Times)

REAL ESTATE AND CONSTRUCTION| Rise In Approved Real Estate Projects

More than $2.7 billion worth of real estate projects were approved during the first four months of the year, a sharp 67.3 percent increase, according to the Ministry of Land and Urban Planning. Speaking Friday at the 2019 Real Estate and Construction Forum, Lao Tipseiha, secretary of state at the ministry, said growth in the sector from January to April has been remarkable owing to political and social stability, national economic growth as well as rising incomes and foreign investment. Mr Tipseiha said that during the four-month period a total of 1,420 projects were greenlighted, a significant increase compared to the 1,171 projects approved from January to April last year. (Jun 03, 2019| Khmer Times)

CAMBODIA  Selected  Indicators

2013

2014

2015

2016f

2017f

2018f

 

Real GDP growth, at constant market prices

7.4

7.1

7.0

7.0

6.9

6.9

 

Private  Consumption

5.8

4.5

5.9

2.4

2.3

2.2

 

Government   Consumption

5.2

2.4

4.4

3.8

10.3

14.5

 

Gross Fixed Capital Investment

15.3

9.1

10.6

8.1

9.7

16.8

 

Exports, Goods and Services

14.0

11.3

7.2

9.5

8.1

8.3

 

Imports, Goods and Services

15.1

10.1

6.5

5.9

5.8

7.9

 

Real GDP growth, at constant factor prices

7.4

6.9

6.9

6.9

6.9

6.9

 

Agriculture

1.6

0.3

0.2

0.4

0.3

0.7

 

Industry

11.0

9.8

11.7

11.4

9.0

7.7

 

Services

8.7

8.7

7.1

6.8

8.5

9.1

 

Inflation (Consumer Price Index)

2.2

1.7

1.3

3.2

3.4

3.5

 

Current Account Balance (% of GDP)

-9.5

-9.0

-8.5

-8.4

-8.5

-8.7

 

Financial and Capital Account (% of GDP)

15.2

14.6

14.1

13.4

12.0

10.8

 

Net Foreign Direct Investment (% of GDP)

11.8

10.0

9.1

8.5

8.2

7.0

 

Fiscal Balance (% of GDP)

-6.5

-3.8

-2.0

-2.9

-4.9

-4.9

 

Debt (% of GDP)

31.6

31.8

32.1

32.6

33.3

34.0

 

Primary Balance (% of GDP)

-5.8

-3.1

-1.7

-2.5

-4.6

-4.6

 

Sources: World Bank, Macroeconomics and Fiscal Management Global Practice, and Poverty Global Practice.

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