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Budget to swell with economy in 2017: gov’t official

Finance Minister Aun Pornmonrith speaks at a seminar on macroeconomic frameworks yesterday morning the National Assembly in Phnom Penh. Photo supplied
Finance Minister Aun Pornmonrith speaks at a seminar on macroeconomic frameworks yesterday morning the National Assembly in Phnom Penh. Photo supplied

Budget to swell with economy in 2017: gov’t official

A Ministry of Economy and Finance official revealed yesterday that the national budget will increase to about $4.6 billion for 2017, a 6.9 per cent increase compared to this year – a figure that mirrors the country’s planned economic growth.

Vongsey Vissoth, secretary of state for the ministry, announced the budget figure on the sidelines of the National Assembly’s seminar on the Macroeconomic Framework yesterday. However, he declined to give a detailed breakdown for the government’s planned spending.

Addressing the seminar, Finance Minister Aun Pornmonrith said that the government will prioritise increasing civil servants salaries to $250 a month by the end of 2018. He also said the budget would help boost investment activity, strengthen the education system, and would pay special attention to the agriculture sector.

“The macroeconomic framework is oriented to strengthen the quality of public services and support the initiative of the government’s reforms on social and economic factors,” the minister said.

In order for the government to achieve its target, he said that the customs department needs to collect revenue equal to 8.29 per cent of GDP, an increase of 9.9 per cent compared to this year’s target. At the same time, the tax department needs to collect the equivalent of 7.74 per cent of GDP, a 20.1 per cent increase compared to 2016.

Chan Sophal, director at the Centre for Policy Studies, said that the government seems to have set out a conservative budget increase, which is reflected by a cautious approach to the global economy.

“I think the budget growth rate is planned with careful consideration because the ministry might see that there is global economic uncertainty that would not benefit the country,” Sophal said.

Son Chhay, chief whip of the Cambodia National Rescue Party, said the proposed 7 per cent increase in the national budget would achieve little for the proposed sectors.

He added that the real increase in the budget would not go to social programs, but could be accounted for in the increase of civil servants’ salaries.

He added that while Cambodia racks up nearly $1.5 billion in foreign debt a year, the government could reduce this figure through budget transparency, better tax collection policies and crackdowns on corruption.

“We believe that 30 to 35 per cent of the budget is lost when it comes into real practices in Cambodia,” he said. “If we improved transparency we could reduce our dependency on foreign loans.”

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