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Economists See Growth Potential in Stock Exchange

Cambodian men hang out by a currency poster during the inauguration ceremony of the Cambodia Securities Exchange in Phnom Penh, Cambodia, Monday, July 11, 2011. Cambodia officially launched its long-delayed stock exchange Monday although no companies are

Cambodia has officially opened a stock exchange, which economists say will provide a chance for the development of the country and job creation. However, they warn that mismanagement of the bourse could also lead to economic woes.

“When this stock market goes well, it will help companies expand their businesses using the capital acquired from the stocks,” said Duch Darin, adjunct professor at Tallahassee Community College in Florida, as a guest on “Hello VOA” last week. “Therefore, this will create jobs for people and increase profits for the companies.”

Cambodia opened its stock exchange on July 11, but so far only three state-owned companies are listed.

Duch Darin said he believes Cambodia is moving in the right direction, away from its socialist economy of the 1980s and toward a free-market system. Its GDP has increased in the last five years, he said, and the stock market should be able to move it further along.

Kang Chandararoath, president of the Cambodian Institute of Development Study, said the exchange will provide capital from previously untapped wealth, but he warned against its mismanagement.

“When we make a mistake in investment and with a lack of transparent management, it will lead to trouble for the country, causing investors to lose confidence in the market as well as shaking the whole economy,” he said.