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Current accounts in control

Current accounts in control

CAMBODIA’S current accounts deficit has increased in recent years, but is not yet a cause for concern, according to experts.

The Asian Development Bank’s July update showed Cambodia’s current accounts deficit stood at 11 percent of GDP in 2010, and statistics show the trade gap grew further in the first six months of the year.

Cambodia’s imports and exports both increased by 48 percent in the first half of 2011 compared year-on-year, hitting $3.245 billion and $2.228 billion respectively, according to Ministry of Commerce figures.

ADB Economics Officer Poullang Doung wrote that higher fuel and food prices increase import costs, but Cambodia had been increasing exports as it recovered from the financial crisis.

“[Increased exports] will gradually help narrow down the current accounts deficit slowly but surely,” he said.

Cambodia’s imports and exports both increased by 48 percent in the first half of 2011 compared year-on-year, hitting $3.245 billion and $2.228 billion, according to Ministry of Commerce figures.

National Bank of Cambodia Spokeswoman and Director General Nguon Sokha said Cambodia need to import inputs such as construction materials to support future economic development.

“This is a normal situation for a developing country [such as Cambodia] that has potential to grow,” she said.

“The point is how the country finances this current account deficit. And so far, the government is doing well in this regard. We do not have a debt problem, and we enjoy macroeconomic stability and also financial stability.”

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