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Graft still 'rampant', says economic survey

Graft still 'rampant', says economic survey

PERVASIVE perceived corruption is the biggest deterrent to investors in Cambodia states a report by the Heritage Foundation into world economic freedom.

The 2010 Economic Freedom Index, released Wednesday, gave the Kingdom 56.6 out of 100 for the extent of its economic freedom, placing it 107th out of 179 countries.

The rating is measured on indicators such as trade and business freedom, government spending, investment opportunity, corruption and property rights.

The score ranks Cambodia 18th most free in the Asia-Pacific region, outperforming Vietnam (144), India (124), Indonesia (114) and the Philippines (109). Thailand was recorded in 66th place.

The analysis of world economies noted that Cambodia’s performance had declined in several key areas since 2009’s report. Monetary freedom plummeted from 80 percent to just 70.5 percent, thanks to persistent dollarisation of the economy.

Rating for government spending also fell from 94.5 to 92.9 despite “ongoing efforts to improve tax administration and budget management”. However, the score was still far above the world average of 65.

The index for freedom of corruption also fell 2 percent year-on-year to 18 points. The world average is 40.5.

The authors of the report said: “Corruption is perceived as rampant. Business people, both local and foreign, have identified corruption as the single biggest deterrent to investment in Cambodia.

“It hampers economic opportunity and competitiveness, and demands for petty bribes are common.” In contrast, despite the findings, the Kingdom was noted to have performed well on improving its trade regime.

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