October 12, 2011

Cambodia still sustains robust growth despite worst floods: deputy PM


PHNOM PENH -- Cambodia would still see robust growth in this year and next year despite worst flood devastation, thanks to strong increases in foreign direct investment, product exports, tourism and recovering construction, the Deputy Prime Minister Sok An, minister of the council of ministers, said Wednesday.

"Despite the damage of floods, Cambodian economy is strongly rebounding, which is projected to be 6 percent and 6.5 percent for 2011 and 2012 respectively," he said during the 2nd day of the 2011 Trade and Investment Conference: Global Challenges, Cambodia's Responses.

"A number of key sectors supporting the economy have showed very positive trends so far this year."

On the foreign direct investment side, he said, during the first eight months of this year, there were 87 projects approved by the Council for the Development of Cambodia. These projects are valued in total at 5.6 billion U.S. dollars, a 250 percent increase over the same period last year. The projects approved included industry, agriculture, and telecommunications ventures.

For the exports, they have increased by nearly 46 percent to 2. 15 billion U.S. dollars, with 80 percent of the exports coming from the garment sector and the rest from the exports of rubber, rice, cassava, corn and other agricultural produces.

In term of tourism, he said, in the first eight months of this year, there was a 15 percent increase in the number of tourists arriving in Cambodia compared to the same months of last year.

"We estimate that there will be nearly 3 million tourists visiting Cambodia in 2011, and the revenue generated by them is anticipated to approach 2 billion U.S. dollars," said Sok An.

Also, the sector of construction and real estate showed strong growth this year after it had been hurt by the global financial crisis in the last three years.

The government approved construction projects have grown by 84 percent year-on-year to 748 million U.S. dollars, he said. "It' s the largest increase in the sector since the crisis three years ago."

On Tuesday, speaking during opening the 2011 Trade and Investment Conference: Global Challenges, Cambodia's Responses, the Deputy Prime Minister Keat Chhon, minister of finance, lowered the country's economic growth to 6 percent this year from the original 7 percent forecast due to the worst flood devastation and uncertainty of the economies of the United States and the European countries.

He said due to floods, agriculture would see growth of 3.6 percent, compared with that of 4 percent in 2010.

At least 207 people were killed and other 1.2 million people have been affected by the Mekong River and flash floods hitting Cambodia since early August. The floods also affected more than 300,000 hectares of rice paddies and completely destroyed other 100,000 hectares of rice paddies.

Some 180 kilometers of national roads and around 1,800 kilometers of gravel roads have been affected, according to the National Committee for Disaster Management.

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