Pandemic math not adding up in Cambodia

[phuketrichard]

Cambodians better tighten their belts,hard times a coming...

Prime Minister HE slashes national budget by 50% at a time the nation desperately needs Covid-19 relief spending
While governments worldwide spend extravagantly to buffer their economies from the Covid-19 pandemic’s ill-impacts, Cambodia is instead tightening its belt.

Last week, Phnom Penh surprised observers by announcing it would slash next year’s state budget by around 50%, notably at a time regional neighbors like Thailand and Singapore are rolling out richly-financed rescue programs.

Specifics of the austerity cuts are still being devised, but it appears provisionally that officials will bring expenditures down to around US$4 billion in 2021, a massive reduction from the $8.2 billion earmarked for 2020.

The latest World Bank estimates suggest Cambodia’s economy will shrink by between 1%-2.9% in 2020, although the worst-case percentage worsens every time the Bank issues a new forecast.

The World Bank’s Cambodia in the Time of Covid-19 report, released last month, stated in a press release that the pandemic “Poses Greatest Threat to Cambodia’s Development in 30 Years.”

https://asiatimes.com/2020/06/pandemic- ... d7ff190aa4

[Kammekor]

The latest World Bank estimates suggest Cambodia’s economy will shrink by between 1%-2.9% in 2020, although the worst-case percentage worsens every time the Bank issues a new forecast.

The World Bank’s Cambodia in the Time of Covid-19 report, released last month, stated in a press release that the pandemic “Poses Greatest Threat to Cambodia’s Development in 30 Years.”

Professional optimism....

With just tourism making up about 20% of the GDP and hardly any tourism for 3 months now (and probably a few months more) a 1%-2,9% decline in GDP seems unreasonably low to me.

[phuketrichard]

thought tourism was like at 32% ?

In 2018, contribution of travel and tourism to GDP (% of GDP) for Cambodia was 32.8 %. Contribution of travel and tourism to GDP (% of GDP) of Cambodia increased from 10.5 % in 1999 to 32.8 % in 2018 growing at an average annual rate of 6.92%

.
https://knoema.com/atlas/Cambodia/topic ... ent-of-GDP

Very optimistic at a only 1-2.9% decline till western countries solve their problem and the garment industry can get back to work

[zojomonde]

why is it not adding up? other countries have reserves, government bonds, credibility to borrow from other governments, what does cambodia have? since H.E. have pissed off most of the white skins and he cant always go back to the yellow skin ATM, what other fiscal policy do you suggest?

[Bitte_Kein_Lexus]

Exactly. Tourism and the garment industry probably account for a large percentage of revenue. 60% of GDP combined or so. The coffers will be light this year. Only other option would be to heavily tax all the okhnas, but that would erode his support base. I notice they streamlined the process to open a business which is nice. Part of the plan to increase revenue.

[Alex]

why is it not adding up? other countries have reserves, government bonds, credibility to borrow from other governments, what does cambodia have? since H.E. have pissed off most of the white skins and he cant always go back to the yellow skin ATM, what other fiscal policy do you suggest?

He could ask Beijing for Cambodia to formally join China as a province? Just a thought and just speeding up or formalizing the inevitable.

[Duncan]

why is it not adding up? other countries have reserves, government bonds, credibility to borrow from other governments, what does cambodia have? since H.E. have pissed off most of the white skins and he cant always go back to the yellow skin ATM, what other fiscal policy do you suggest?

Cambodia has charitable funds.


Quote ]
The purchase of these military vehicles did not use the state budget, according to a senior army general. The source said that this fund is a charitable fund donated by Samdech Techo HE in support of the Royal Cambodian Armed Forces and the National Police.

[Felgerkarb]

You left out the 24% rise in taxes and fees slated to be rolled out.

[Clutch Cargo]

Put those riel printing presses into overdrive. Isn't that what most other countries are doing...call it fiat money or MMT (Modern Monetary Theory lol)..

[DaveG]

Put those riel printing presses into overdrive. Isn't that what most other countries are doing...call it fiat money or MMT (Modern Monetary Theory lol)..

True.....

https://www.expressandstar.com/news/uk- ... ic-plunge/

https://www.ft.com/content/c2e92d75-7e3 ... 7a5df6cf2b