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As Losses Mount, Plans To Help Economy Emerge

Cambodia’s four main economic drivers have sustained multi-million dollar losses so far this year, despite insulation from the financial markets, a leading economist said Monday.

A report released by the International Labor Organization released Monday shows losses of $280 million in garments, $260 million in tourism, $180 million in agriculture and $45 million in construction.

Despite those losses, Cambodia remains somewhat insulated from the global financial crisis, said Kong Chandararoth, president of the Cambodian Institute of Economic Study and Development.

“Our country is not close to the financial market, so that does not have an impact as serious as other countries,” he said, as a guest on “Hello VOA.”

Cambodia’s agriculture has also made the global financial downturn easier that industrialized countries, he said.

Organizations like the International Monetary Fund and Asian Development Bank have warned that Cambodia’s economy will shrink this year, thanks to the financial crisis.

However, Kong Chandararoth said such predictions were “too dark about Cambodia,” and he predicted economic growth around 5 percent for 2009.

Cambodia’s situation is further different from other countries, he said, because it does not have a stock exchange or other financial markets, which have been hard-hit by the collapse of the US financial market.

Meanwhile, the government has prepared a package to restore the economy, including tax exemptions, tourism promotion, and help for construction, agriculture, garment factories and other investments.

The government announced Tuesday it will release $25 million to the agriculture and garment sectors, in an effort to mitigate the effects of the global downturn.

The money—$18 million to agriculture and $7 million to garments—will be used to increase farm production and help train people who have lost their jobs thanks to the slowdown.

Government officials made the announcement during the semi-annual donors meeting on Tuesday.