ANZ Banking Group’s global chief painted a positive picture of Cambodia’s economic future during a key-note speech Thursday in Phnom Penh.
Speaking to the Australian Business Association at the capital’s Intercontinental Hotel, ANZ’s Chief Executive Officer Mike Smith predicted Cambodia would see 5 percent economic growth in 2010 after “a difficult” 2009.
The forecast is higher than the 4.25 percent GDP growth predicted for the Kingdom in December by the International Monetary Fund (IMF), which warned that “risks are clearly tilted to the downside”.
The World Bank has estimated that Cambodia’s GDP was US$9.4 billion in 2008.
When quizzed about his estimate by a member of the 170-strong audience, who described it as “the most bullish we have heard”, Smith said: “I think we can be more optimistic.”
The financial heavyweight, who was once president and CEO of HSBC, said the Kingdom was experiencing infrastructure development and rising productivity in the agricultural sector.
He said he believes that an awareness of the need for nations within the Greater Mekong area – consisting of Cambodia, Laos and Vietnam – to work together, coupled with “more significant” inter-country trade, will provide a boost for the economy.
“What made 2009 so difficult was the export dependency Cambodia had with the US and Europe. There is an opportunity now to focus on trade within the region,” he said, before pointing to statistics released last week which indicated that Cambodia and Indonesian bilateral trade rose 24 percent in the first 10 months of 2009 from the same period in 2008, increasing to $165 million from $133 million.
Smith’s confidence comes as Cambodia has entered into free-trade agreements with its fellow ASEAN member nations and China.
Both pacts came into effect on January 1 this year and ensure that the Kingdom will gradually decrease trade levies on many goods to zero by 2015.