Cambodia should expect price inflation of 6 percent this year, according to a United Nations report released yesterday, which government officials said was a tolerable level.

Rising food price and a declining United States dollar were leading to price increases for Cambodia, the United Nation’s Economic and Social Survey of Asia and Pacific 2011 said.

The report noted Cambodia’s prices increased by 4.1 percent in 2010, after decreasing 0.7 percent in 2009 and increasing by 25 percent in 2008.

Minister of Economy and Finance Deputy Secretary General Ros Seilava said at the report’s release in Phnom Penh that 6 percent inflation for 2011 was a manageable level.

“A six to seven percent increase in inflation is expected this year, however to a certain level, this could be tolerated,” he said.

The UN’s report estimated the Kingdom’s GDP would expand by 6.2 percent this year, led by growth in the garments, tourism and agriculture sectors.

It also highlighted challenges in diversifying the domestic economy away from heavy reliance on exports to specific Western countries.

Ros Seilava said the Cambodian government’s pro-trade policies and incentives to foreign investors would help the domestic economy grow.

He noted the government may have underestimated the economic implications of the global financial downturn on the domestic economy, but said experts were now more prudent in their approach.

“The situation was misjudged, however the government are now closely following inflation,” he said.

“I think everything is now under control.”