WEEKLY ECONOMIC UPDATED
Updated:28 Dec,2019-03 Jan,2020

TRADE & COMMERCE | Cambodia Achieves Economic Miracle But Much Remains To Be Done

While Cambodia has achieved nothing short of a “miracle” in terms of economic development, there is still much to be done if the Kingdom wants to improve or sustain such progress and the financial/ non-financial wellbeing of its people in the long run. The 2019 Global Sustainable Competitiveness Index released last week by SolAbility ranked Cambodia second to last among countries in Southeast Asia. SolAbility described itself as a sustainable intelligence think-tank. It started operations in 2005 as a Swiss-Korean joint venture. According to SolAbility, the Index measures current and future capability of countries to generate and/or sustain financial and non-financial income and wealth for its population. (Jan 03, 2020 | Khmer Times)

TRADE & COMMERCE | Factories Given Export Rights

The Ministry of Commerce granted export rights under the preferential trading system to 78 garment, footwear and bag factories in the first 11 months of last year, its annual report stated. The ministry registered 51 such facilities from January to November last year, an increase of 24 per cent on the 41 in the same period in 2018, the report said. Twenty-seven bag factories were registered, an increase of 170 per cent year-on-year on the 10 registered in the proceeding period, while 138 exporters and other factories registered, a 21 per cent increase. Garment Manufacturers Association in Cambodia (GMAC) secretary-general Kaing Monika told The Post on Wednesday that Cambodia has seen positive effects from the US-China trade dispute, which has prompted a surge in garment and footwear registrations. (Jan 01, 2020 |Phnom Penh Post)

TOURISM | Tourism Cruises Mooted Between China, Cambodia

Cambodia has asked Chinese investors to consider investing in a cruise tourism service between China and Cambodia, aiming to boost the travel of Chinese tourists to Cambodia and vice versa. Hun Dany, secretary of state of Ministry of Tourism, raised the idea among Chinese investors during a visit to Hainan province, China, earlier this week, according to a post on the Ministry of Tourism’s Facebook page. He suggested Chinese investors weigh up the idea of a cruise tourism service from Hainan island province to Preah Sihanouk province, where cruise ships carrying tourists could dock for a short visit by passengers. The cruise service was one of several tourism development ideas proposed by Cambodia, the post read. This year has been labelled The Year of Tourism by the Cambodian government. ( Jan 03, 2020/Khmer Times)

TOURISM | Gov’t Says It Is Ready To Tackle Decline In Tourists At Angkor

Tourist arrivals at the world-famous Angkor Archaeological Park in Cambodia’s Siem Reap saw a 15 percent decrease last year, but the government said it has mapped out a plan to address the problem. Angkor Enterprise’s latest report, announced this week, shows that about 2.2 million foreign tourists bought passes to the temple complex in 2019, a 15 percent decline over the same period in 2018. It noted income from ticket sales reached $99 million. Angkor Enterprise – a public administration, which is under the technical supervision of the Ministry of Tourism and under the financial supervision of the Ministry of Economy and Finance – sold entrance passes to 2.5 million foreign tourists, earning $116 million in 2018. Top Sopheak, spokesperson at Tourism Ministry, said the Ministry has worked with relevant authorities and reached a solution. (Jan 02, 2020/Khmer Times)

FINANCE AND BANKING | PPCBank is Looking To Expand And List Bonds On Local Bourse

Phnom Penh Commercial Bank, a subsidiary of South Korea JB Financial Group, said after a good performance last year it plans to expand. Shin Chang Moo, president of PPCBank, told  Khmer Times the bank will add four more branches to its current 21 in the Kingdom, where it has 46 ATMs. The expansion will be on the outskirts of Phnom Penh and in other provinces, including Kompong Speu, Poipet and Bavet city in Savy Rieng province. “We are reviewing and we have to plan ahead what kind of strategies that we will bring to the areas … we have to customise the market,” said Shin. In order to support its expansion, the bank is now mulling whether to issue corporate bonds on the Cambodia Security Exchange to raise funds. (Jan 03, 2020/Khmer Times)

FINANCE AND BANKING | Debt Securities Listing Cleared For Ppcbank And Acleda

The Securities Exchange Commission of Cambodia (SECC) on Thursday confirmed that two of the Kingdom’s largest commercial banks would be approved and enjoy debt securities listing in the first quarter. Its director-general Sou Socheat told The Post that Acleda Bank Plc (Acleda) was the first commercial bank to be approved, while the Phnom Penh Commercial Bank Plc (PPCBank) earned the distinction of becoming the first South Korean commercial bank to meet the benchmark. He said the SECC would conduct an internal meeting to further review both applications before formally requesting approval from the Ministry of Economy and Finance later this year. “We will process the Acleda and PPCBank applications at the same time. We will do our best to submit our request [to the ministry] as soon as possible,” he said. (Jan 02, 2020/Phnom Penh)

AGRICULTURE | Boosting Domestic Vegetable Production To Curb Imports

The Ministry of Agriculture is taking action to grow more food domestically to cut down on imports. The country planted a variety of vegetables covering a total 58,000 hectares of land nationwide by the end of 2019 that produced 68 per cent of local market demand, according to Ministry of Agriculture’s spokesperson Srey Vuthy. By 2023, he wants this to increase to 63,000 hectares and 76 percent respectively, he said. The move would help Cambodia’s balance of payments, which currently sees more imports than exports. “We have set out a plan in order to boost vegetable growing in our country to supply the domestic market and with this move we hope that vegetable imports from neighbouring countries will gradually decrease,” Srey told the Khmer Times. (Jan 03, 2020 | Khmer time)

REAL ESTATE AND CONSTRUCTION| Affordable Housing Project In Poipet Town Under Way

Construction of Sokha Residences Sanco, an affordable housing development in Poipet town with capital investment of around $151 million, is set to be complete in early 2023. The project, which broke ground in mid-December, is to have 4,296 units across nine 19-floor buildings on an area of 38,400sqm. Sokha Residences Sanco is the second affordable development project in Cambodia after the Arakawa project in Phnom Penh’s Sen Sok district. Hor Kunthea, the CEO of MR Sokha Residences Group, told The Post on Wednesday that this is the company’s first affordable housing development. The firm had previously built high-end housing projects, with all three in Poipet town.  (Jan 01, 2020| Khmer Times)

REAL ESTATE AND CONSTRUCTION| Cambodia’s Hotel Industry Trend Coming Into 2020 Predicts Big Rise

Cambodia’s tourist arrival record is set for another breakthrough year in 2019 as data from the Ministry of Tourism projects a substantial increase from 2018’s 6.2 million total recorded arrivals. Between January to September 2019, there have already been 4.8 million international tourists arrivals in Cambodia, this figure is 10% higher compared to the same period in 2018. This year-over-year increase has not been lost on Cambodia’s hotel sector. Hotel investments have increased  to accommodate the growing demand – projected by the government to reach 15 million by 2030 – has hoteliers scrambling for the piece of the growing industry. Hotels in Cambodia can mainly be found in Phnom Penh, Siem Reap, and Sihanoukville. Data from the Ministry of Tourism shows Phnom Penh has surpassed Siem Reap in terms of tourist arrivals by air. 70% of tourists to Cambodia arrive by air every year. (Jan 01, 2020| 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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The report is produced based on material compiled from data considered to be reliable at the time of writing. Information and opinions expressed, however, will be subjected to adjusted at short notice. We do not accept any liability directly or indirectly that may arise from investment decision-making based on this report while we tend share as your information only.

 

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