ADB head praises Kingdom’s economic progress

ADB head praises Kingdom’s economic progress

Visiting Asian Development Bank president Takehiko Nakao gave a glowing assessment yesterday of Cambodia’s last decade of rapid economic growth and commended the government for its new policy aimed at diversifying the economy.

Citing an annual average growth rate of 6.5 per cent between 2007 and 2014, and a reduction in poverty from 50 per cent in 2007 to 19 per cent in 2012, Nakao said Cambodia had made good progress from its low economic base over the past two decades.

“The inflation rate has been controlled and the exchange rate has been stable,” he said.

Following a meeting yesterday with Prime Minister Hun Sen, the ADB boss said he was “encouraged” by the government’s newly completed Industrial Development Policy, which targets broadening Cambodia’s manufacturing base.

But challenges still persist, Nakao said, with improvements to education, infrastructure, public sector accountability and the cost of electricity needed to attract investment to the country.

“Many companies are looking at Cambodia for investment opportunities from abroad and also from within the country, but those companies need skilled workers in factories, in construction and in electricity,” he said.

Despite ranking among some of the world’s poorest performing countries when it comes to corruption, Nakao said that Cambodia had made improvements.

“We are very happy that the government of Cambodia enacted the anti-corruption law and introduced the anti-corruption unit to address those issues,” he said.

On the troubled $143 million railway rehabilitation project, whose Northern line is still to be fully restored, the ADB’s country director in Cambodia, Eric Sidgewick, said there was no funding currently allocated to finish the link, nor had the government requested for an additional ADB loan for the project.

A scathing report released last year from the ADB’s internal watchdog found that the bank, who is the largest donor on the project, had failed in its own safeguards to ensure the just resettlement of thousands of people living along the railway line.

ADB boss Nakao, said yesterday, that the bank was still working with affected households on ensuring proper compensation and support with indebtedness caused by relocations.

“The ADB is thinking of using some microfinance framework arrangement for those people who are rectified for that issue,” he said.

Contacted yesterday, Eang Vuthy, executive director of Equitable Cambodia, an NGO working with displaced families, said the ADB was continuing to meet with communities as it implements its remediation plan, but problems to do with “income restoration” still persisted.

The ADB’s Compliance Review Panel had recently come to Cambodia to assess the progress of remedial action and would be submitting a report to the bank’s board next month, Vuthy said.

“We look forward to seeing that report to make sure they are really making progress, but to us it is very slow, this progress” he said.

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