Logo of Phnom Penh Post newspaper Phnom Penh Post - Economists remain upbeat despite investment fall

Economists remain upbeat despite investment fall

Economists remain upbeat despite investment fall

Investment approved by the Council for the Development of Cambodia dropped some 54 percent in 2010, compared with the previous year, but experts believe the decline is not indicative of the Kingdom’s ongoing economic recovery.

Approved projects were worth some US$2.69 billion in 2010, a steep decline from 2009’s $5.86 billion, figures obtained Tuesday show.

Asian Development Bank senior country economist Peter Brimble said late Tuesday it was important to take “lumps” into account, noting a multi-billion dollar island development project approved in 2009 had distorted the figures.

“I certainly do not feel there was a decline of that magnitude [in the Kingdom’s economy],” he said. “We [the ADB] feel there is an economy recovery in 2010.”

The largest approval this year was the proposed new Siem Reap airport project, said to be worth near $1 billion.

Cambodia Institute for Development Study president Kang Chandaroth said that despite the fall, the large amounts of approved foreign investment in the Kingdom proved it was becoming a reliable country for business.

“We expect inflows of foreign investment capital will keep increasing this year and in other years because both Cambodian and the global economic situations are performing better,” he said.

CDC deputy secretary general Duy Thov said that although 2010’s pledged investment was less than in 2009, the inflow of foreign-based capital investment had increased.

In 2009, foreign pledges accounted for around $2.10 billion dollars, compared to $2.29 billion in 2010.

The figures do reveal some trends regarding investment by country and by sector, such as South Korea’s relative strength during 2010, according to Brimble.

He added that levels of foreign direct investment were often a better indicator of relative economic strength. FDI in the first three quarters of 2010 already exceeded all of 2009, he added.

Two more projects were approved in 2010 compared with 2009, with 74 of the 102 approvals being in industry, 23 in agriculture, three in tourism and two in services.

Approvals had topped $10 billion in 2008, before falling to $5.86 billion in 2009.

The CDC also noted the figures’ shortcomings, claiming it was important to look at multiple sets of data before coming to a conclusion on the state of the economy. ADDITIONAL REPORTING BY JEREMY MULLINS

MOST VIEWED

  • NY sisters inspired by Khmer heritage

    Growing up in Brooklyn, New York, Cambodian-American sisters Edo and Eyen Chorm have always felt a deep affinity for their Cambodian heritage and roots. When the pair launched their own EdoEyen namesake jewellery brand in June, 2020, they leaned heavily into designs inspired by ancient Khmer

  • Cambodia records first Omicron community case

    The Ministry of Health on January 9 reported 30 new Covid-19 cases, 29 of which were imported and all were confirmed to be the Omicron variant. The ministry also reported 11 recoveries and no new deaths. Earlier on January 9, the ministry also announced that it had detected the Kingdom's

  • The effects of the USD interest rate hike on Cambodian economy

    Experts weigh in on the effect of a potential interest rate expansion by the US Federal Reserve on a highly dollarised Cambodia Anticipation of the US Federal Reserve’s interest rate hike in March is putting developing economies on edge, a recent blog post by

  • PM eyes Myanmar peace troika

    Prime Minister Hun Sen has suggested that ASEAN member states establish a tripartite committee or diplomatic troika consisting of representatives from Cambodia, Brunei and Indonesia that would be tasked with mediating a ceasefire in Myanmar. The premier also requested that Nippon Foundation chairman Yohei Sasakawa

  • Kampot tourism quay ‘90% done’

    Construction on Kampot International Tourism Port – a 4ha quay in Teuk Chhou district about 6km west of Kampot town – has fallen off track, reaching 90 per cent completion, according to a senior Ministry of Tourism official last week. The project is now planned to be finished

  • Demining rat ‘hero’ Magawa dead at 8

    A landmine-hunting rat that was awarded a gold medal for heroism for clearing ordnance from the Cambodian countryside has died, his charity said on January 11. Magawa, a giant African pouched rat originally from Tanzania, helped clear mines from about 225,000sqm of land – the equivalent of 42