PHNOM PENH, April 28 (Xinhua) — Amid the raging COVID-19 pandemic, Cambodia’s economy in 2020 registered its slowest growth since 1994. However, the country’s growth is projected to rebound 3.5 percent this year, thanks to its newly-signed bilateral free trade agreement with China and the Regional Comprehensive Economic Partnership (RCEP).
A government report showed that the Southeast Asian nation’s economy shrank 1.9 percent last year, to 27.6 billion U.S. dollars.
Despite the pandemic, Cambodia’s total trade volume reached 35.8 billion dollars in 2020, up 2.5 percent from a year earlier. The GDP growth in 2021 is forecast to rebound 3.5 percent this year, said the government report.
Cambodia has been fighting a third wave of COVID-19 community transmission since Feb. 20. The kingdom logged 508 new cases on Tuesday, pushing the national count to 11,063, with 82 fatalities, said the Ministry of Health. Currently, there are 7,270 active cases in the country.
To mitigate the socio-economic impacts caused by COVID-19, the government has released an 800-million-dollar stimulus package for 2021, according to Economy and Finance Ministry spokesman Meas Soksensan.
“Global pandemic and global supply chain disruption have been causing difficulties for Cambodia’s economic development,” he told Xinhua recently. “To support the socio-economic development during the pandemic, the government has released a stimulus package of around 800 million dollars for this year.”
Mey Kalyan, senior advisor to the Supreme National Economic Council, said the limited production capacity of not-so-high value added products, combined with the limited saving capacity of the majority of the population as well as the dependency on situation in foreign countries, all have made Cambodia’s economy vulnerable to negative shocks like COVID-19.
“If COVID-19 continues further, the negative impact will worsen even more,” he told Xinhua. “The impact is more acute on poor layers of the society.”
Chheang Vannarith, president of the Phnom Penh-based Asian Vision Institute, said promoting a sustainable, inclusive, and resilient economic recovery is the most challenging journey for Cambodia.
“It requires strong political will and material resources to build social infrastructure, enhance social protection and justice, and improve public service delivery,” he said. “Corruption remains the key issue that needs to be urgently addressed at all levels otherwise it is hard to attract foreign direct investment.”
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