Many Cambodians were already over-indebted before the latest crisis, and now they are struggling with the coronavirus financial downturn. In their statement, civil society organizations said that 2.6 million Cambodians owed an average of more than $3,800 to microfinance institutes. This, they said, was “the largest amount in the world.”

For Many Cambodians, Debt Repayment Bigger Threat Than COVID-19
By Phorn Bopha, Khan Sokummono
May 16, 2020 11:06 PM

KANDAL PROVINCE, CAMBODIA - Deep household debt might soon push Cambodia into a crisis as job losses caused by COVID-19 make it even harder for families repay loans, experts and debtors say.

While the country has officially only registered 122 coronavirus cases, thousands of garment workers lost their jobs when their factories closed. Thousands from the tourism or service sectors are also jobless or earning far less money than they were six months ago. For some, this crisis could have devastating consequences, including loss of family land, often a fast track to abject poverty.

Hy Sokhom, who drives a tuk-tuk, a three-wheeled motorized rickshaw, is one of millions of Cambodians who, on average, are the world’s most indebted borrowers. Usually his wife and adult daughter sell noodles at a school in Kandal province’s Kien Svay district, but the school closed mid-March as part of measures to contain the spread of the coronavirus.

The family lost $10 in daily income.

The couple’s two sons lost their jobs in Bavet city when the casinos closed under similar measures to contain the COVID-19 outbreak.

The family lost $300 in monthly income the sons sent home.

Covering the $400 monthly installments for their $18,000 loan --- for a new tuk-tuk, home renovations and the cost of their sons’ move six months ago to Bavet, near the Vietnam border --- seems impossible.

They also must make monthly payments to two microfinance institutions (MFI) of about $50 each, bringing their monthly total to $500.

One of the sons started a low-paying job as a security guard a few weeks ago, but that did little to alleviate the pressure on Hy Sokhom.

Tourism takes a hit

Tourism, a growth industry with foreign arrivals exceeding 2 million people per year in 2007 and 6.6 million in 2019, has ground to a halt. Before the coronavirus, Hy Sokhom brought home about $20 a day. Now, $7.50 is a good day.

“We don’t have money to pay the bank and not enough money to buy food,” said Hy Sokhom’s wife, Keith Mom. She believes the family deserves a break for never missing a payment before the coronavirus swept through the economy.

“I want [the bank and microfinance institutions] to help assist us with a two- to three-month moratorium,” Keith Mom, 48, said. “They could collect money from us as normal when [this] is over.”

But their bank, ABA, is insisting the family make the regular monthly installment, she said.

One of Cambodia’s biggest banks, ABA is backed by the National Bank of Canada. An ABA spokesperson told VOA Khmer that it could not address specific cases. The spokesperson added that loan forbearance required an investigation of “our customer’s income situation.”

Late last month, 135 civil society organizations urged the government to ensure that microfinance institutions immediately suspend all loan repayments and interest accrual for at least three months. This, they said, was “necessary to ensure that people are able to survive this crisis without risking their health or homes.”

The Cambodia Microfinance Association (CMA) and the Association of Banks in Cambodia (ABC) said the nongovernmental organizations’ statement “does not reflect the real situation and is adversely affecting the banking and financial sector.”
https://www.voanews.com/south-central-a ... t-covid-19

Which country in the region will be the first to open its doors to tourists will get a bigger relative share of them compared to before. The only problem is how to get there when most aircraft is grounded. But i guess countries will not be banning flights if the receiving country is ready to welcome them. Some European countries open their borders already or starting from June, not afraid any more. It was an irrational fear from the beginning and it must end.

Open the borders, and quickly. There is still time to save 2020.

Doc67 wrote: ↑Mon May 18, 2020 1:19 pm Open the pubs, and quickly. There is still time to save 2020.

UK English.

fazur wrote: ↑Mon May 18, 2020 1:46 pm

Doc67 wrote: ↑Mon May 18, 2020 1:19 pm Open the pubs, and quickly. There is still time to save 2020.

UK English.

Hell yeah!! Word is that early to mid July for the pubs, just about the time that I might be able to get back to Cambodia.

hunter8 wrote: ↑Mon May 18, 2020 1:18 pm Which country in the region will be the first to open its doors to tourists will get a bigger relative share of them compared to before. The only problem is how to get there when most aircraft is grounded. But i guess countries will not be banning flights if the receiving country is ready to welcome them. Some European countries open their borders already or starting from June, not afraid any more. It was an irrational fear from the beginning and it must end.

Do you think you could actually post something on topic for once?

Open borders. Legalize weed. Open coffee shops like in NL. Weed is widely consumed around Cambodia anyway.

Chuck Borris wrote: ↑Mon May 18, 2020 2:08 pm Open borders. Legalize weed. Open coffee shops like in NL. Weed is widely consumed around Cambodia anyway.

Because when you're baked you don't worry about your crushing debt?

Clemen wrote: ↑Mon May 18, 2020 2:13 pm

Chuck Borris wrote: ↑Mon May 18, 2020 2:08 pm Open borders. Legalize weed. Open coffee shops like in NL. Weed is widely consumed around Cambodia anyway.

Because when you're baked you don't worry about your crushing debt?

No, but collected taxes could be used for covid19 economic impact relieve.

https://www.forbes.com/sites/niallmccar ... e1447b7085