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World Bank Estimates Small Drop in Economic Growth

A Cambodian vendor cleans rice at her shop in a roadside market in Phnom Penh, file photo.
Cambodia’s economic growth for 2014 will drop to 7.2 percent, a slight dip from last year, the World Bank says in a recent report.

The drop is due to political uncertainty and labor unrest, the bank said.

Cambodia’s economic growth for 2014 will drop to 7.2 percent, compared to last year which saw the growth up to 7.4 percent, World Bank report said. During launch of its daily six-month report at its headquarter this Monday morning, the report reason of this decrease, due to political uncertainty and labour unrest.

World bank 2014 project on Cambodian economy is published just after Asian Development Bank last week launched its 2014 outlook on country’s economy, to be decreased to 7 percent in 2014 with similar reasons. Meanwhile international monetary fund (IMF) shows that public external debt in Cambodia is expected to increase to nearly 5.6 billion dollars in 2014.

“I am impressed with Cambodia’s economic growth, despite the uncertainty of political and labor unrest. The country is still place to benefit for invest, especially on textile and tourism”, said Bert Hofman, chief economist East Asia and Pacific of World Bank group in Singapore.

Cambodia’s economic growth is heavily depended on the export of cloths and rice to United States and European countries and tourism, sharing 44 percent and 14 percent of Cambodian GDP respectively. But, in 2014, total investment money is expected to decreased to 1.2 billion dollars, compared to 1.4 billion dollars in 2013. 2014 inflation is estimated to increase to 5 percent in 2014, compared to 2013 is 4.7 percent.

Alassane Sow, World Bank country manager, said Cambodia’s economy has been adapted to domestic pressure and manage to sustain its growth which helps Cambodia to reduce poverty rate 1 percent each year. However, he added that “ almost 3 million people remain poor and over 8.1 millions are near-poor. They are still at high risk of falling back to poverty.”

Kem Ley, independent social analysis, said despite a joy of growth, the number of the poor remain increasing from year to year. World bank taking data from national institution of statistic to project Cambodia’s economy sometimes has problem because the institution is under control of government.