Clear Skies : Cambodia Economic Update, October 2014

This issue of the Cambodia economic update covers the following selected issues: 1) making the most of the Cambodian rise sector; and 2) creating opportunities for firms as reflected in findings from the investment climate assessment. For FY2014 ec...

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Bibliographic Details
Main Author:	World Bank Group
Format:	Economic Updates and Modeling
Language:	English en_US
Published:	Washington, DC 2014
Subjects:	ACCOUNTING ADVANCED ECONOMIES AGRICULTURAL COMMODITIES AGRICULTURAL COMMODITY AGRICULTURAL PRACTICES AGRICULTURAL PRODUCTION AGRICULTURE AUDITS BANK FINANCING BANKING SECTOR BANKING SUPERVISION BANKING SYSTEM BENEFICIARIES BORROWING COSTS BROAD MONEY BUSINESS CLIMATE BUSINESS ENVIRONMENT CAPITAL FORMATION CAPITAL INFLOWS CAPITAL INVESTMENT CAPITAL STOCK CENTRAL BANK CODE OF CONDUCT COLLATERAL COMMODITY EXPORTS COMMODITY PRICES CONSUMER PRICE INDEX CONSUMERS CONSUMPTION GOODS CPI CREDIT GROWTH CURRENT ACCOUNT CURRENT ACCOUNT BALANCE CURRENT ACCOUNT DEFICIT DEBT DEBT BURDEN DEBT SERVICE DEBT SERVICE RATIO DEBT SUSTAINABILITY DEPOSIT DEPOSIT RATE DEPOSITS DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT STRATEGY DOMESTIC BANK DOMESTIC CREDIT E-COMMERCE ECONOMIC ACTIVITY ECONOMIC DEVELOPMENT ECONOMIC DEVELOPMENTS ECONOMIC EXPANSION ECONOMIC GROWTH ECONOMIC IMPACT ECONOMIC SECTORS ENVIRONMENTAL ENVIRONMENTS EXCHANGE RATE EXCHANGE RATE TARGETING EXCHANGE RATES EXPANSIONARY FISCAL POLICY EXPENDITURE EXPORT COMPETITIVENESS EXPORT GROWTH EXPORT MARKET EXPORTER EXPORTERS EXPORTS EXTERNAL DEBT EXTERNAL FINANCING FARMS FEDERAL RESERVE FEDERAL RESERVE SYSTEM FINANCIAL CRISIS FINANCIAL INSTITUTIONS FINANCIAL MANAGEMENT FINANCIAL SECTOR FINANCIAL SECTOR DEVELOPMENT FINANCIAL STABILITY FISCAL BALANCE FISCAL CONSOLIDATION FISCAL DEFICIT FISCAL POLICY FISHERIES FIXED ASSETS FOOD PRICE FOREIGN CURRENCY FOREIGN DIRECT INVESTMENT FOREIGN EXCHANGE FOREIGN EXCHANGE RESERVES FOREIGN INVESTMENT FOREIGN INVESTORS FOREIGN MARKETS FOREIGN TRADE FORESTRY GDP GLOBAL ECONOMY GOVERNMENT EXPENDITURE GOVERNMENT EXPENDITURES GOVERNMENT REVENUES GOVERNMENT SAVINGS GOVERNMENT SPENDING GROSS DOMESTIC PRODUCT GROWTH RATE GROWTH RATES HOLDINGS HUMAN DEVELOPMENT IMPORTS INCOME INCOME TAX INFLATION INFLATIONARY PRESSURE INSTRUMENT INTEREST RATE INTEREST RATE SPREAD INTEREST RATES INTERNATIONAL BEST PRACTICE INTERNATIONAL FINANCIAL MARKETS INTERNATIONAL MARKET INTERNATIONAL RESERVES INTERNATIONAL TRADE INVESTMENT CLIMATE INVESTMENT PROJECTS INVESTOR CONFIDENCE JOINT VENTURES LABOR MARKET LAND POLICY LAND TITLE LDCS LENDER LENDER OF LAST RESORT LEVEL PLAYING FIELD LOAN LOCAL BUSINESS LOCAL CURRENCY LOCAL GOVERNMENT LOCAL GOVERNMENTS LONG-TERM INVESTORS LOW-INCOME COUNTRIES MACROECONOMIC ENVIRONMENT MACROECONOMIC MANAGEMENT MACROECONOMIC POLICY MACROECONOMIC STABILITY MACROECONOMIC UNCERTAINTY MACROECONOMICS MAJOR CURRENCIES MARKET STABILITY MICROENTERPRISES MIDDLE-INCOME COUNTRIES MONETARY AGGREGATES MONETARY AUTHORITIES MONETARY POLICY MONEY GROWTH NATIONAL BANK NATIONAL CURRENCY NATURAL DISASTERS NEW MARKETS OIL OPEN MARKET OUTPUT OUTSTANDING CREDIT POLICY ENVIRONMENT POLITICAL STABILITY POLITICAL TURMOIL POLITICAL UNCERTAINTY PORTFOLIO POST-CRISIS PERIOD POVERTY REDUCTION PRICE RISKS PRICE STABILITY PRICE VOLATILITY PRIMARY MARKET PRODUCERS PRODUCTION FUNCTION PRODUCTION INCREASES PRODUCTIVITY PUBLIC INVESTMENT PUBLIC INVESTMENTS PUBLIC SPENDING REAL EFFECTIVE EXCHANGE RATE REAL ESTATE REAL GDP REAL GROWTH RATE REFORM PROGRAM REGULATORY ENVIRONMENT REGULATORY FRAMEWORK REMOTE AREAS RESERVES RESOURCE ALLOCATION RETURN RETURNS SECURITIES SHORT-TERM BORROWING SHORT-TERM DEBT SHORT-TERM INTEREST RATE SOCIAL DEVELOPMENT SPECULATIVE BUBBLES SUSTAINABILITY ANALYSIS TAX TAX COLLECTION TAX INCENTIVES TAX REVENUE TECHNOLOGICAL CHANGE TECHNOLOGY TRANSFERS TRADE BALANCE TRADE DEFICIT TRADE TAXES TRADING TRADING PARTNERS TREASURY TREASURY SECURITIES URBANIZATION VALUE ADDED WAGES WHOLESALE PRICES WORKING CAPITAL WORLD DEVELOPMENT INDICATORS
Online Access:	http://documents.worldbank.org/curated/en/2014/10/20260732/clear-skies-cambodia-economic-update http://hdl.handle.net/10986/20438

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Summary:	This issue of the Cambodia economic update covers the following selected issues: 1) making the most of the Cambodian rise sector; and 2) creating opportunities for firms as reflected in findings from the investment climate assessment. For FY2014 economic growth held up well despite domestic uncertainty and instability in neighboring countries. Real growth is estimated to reach 7.2 percent, driven by the garment, construction, and services sectors. Overall macroeconomic management has been good with fiscal consolidation underpinned by improved revenue administration. In 2015 with the expectation of renewed confidence and the return of political stability after ending a yearlong political deadlock in July 2014, bolstered by a strengthening global economy, Cambodia's real growth rate is expected to reach 7.5 percent, similar to that of 2013. The downside risks to the projected robust growth are a potential recurrence of labor unrest, natural disasters, especially the possibility of heavy floods, as well as regional political uncertainty. Concerning rice production, growth decelerated in 2013 highlighting the importance of revitalizing the rice sector so it becomes once again a key engine of GDP growth. While the milled-rice export market is steadily expanding and increasing the number of destination markets, the milling and transport costs of Cambodian rice make it loose the competitiveness it has at farm gate prices. The Royal Government of Cambodia (RGC) has set a very legitimate target of one million tons of milled rice exports that matters tremendously for poverty reduction and shared prosperity. Concerning the investment climate assessment findings, RGC's new five-year Rectangular Strategy III continues to prioritize improving the business environment to help diversify and increase value-added in production. The current period of robust growth represents an opportunity to make improvements to the business environment that will attract long-term investors. Proposed next steps in reforming the business environment include: a) addressing the high cost of electricity; b) automating government processes; c) encouraging new investment, particularly in special economic zones; d) continuing improvements to trade facilitation; e) completing the draft Competition Law; f) designing and implementing a system of incentives for business registration; and g) focusing on implementation and enforcement.

Clear Skies : Cambodia Economic Update, October 2014

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