Cambodia maintained an inflation rate of three per cent in the first eight months of this year, despite a sagging economy.
National Bank of Cambodia (NBC) governor Chea Chanto said this after meeting with Yasuhisa Ojima from the International Monetary Fund (IMF) in Cambodia.
The macroeconomic situation and the banking sector in Cambodia in the first eight months of 2020 have been performing well while inflation remains low with good exchange rate stability and international reserves.
Chanto said: “The banking system is strong and has actively contributed to supporting economic activity and alleviating the hardships of various sectors of the population.”
Ojima said he supported the government’s policies and the NBC to support economic activity at this phase, as countries around the world are facing an economic downturn and the spread of Covid-19.
He said: “The IMF is ready to cooperate and make recommendations in the process of restoring Cambodia’s economic growth.”
The government has introduced social welfare packages of about $2 billion so far.
The Asian Development Bank (ADB) last week upgraded its 2020 growth forecast for Cambodia due to improved agricultural performance and an increase in non-garment manufacturing exports such as bicycles and electronics.
The ADB forecasts a four per cent GDP contraction compared to its June forecast of 5.5 per cent.
ADB country director Sunniya Durrani-Jamal said the coronavirus is an unprecedented global challenge, but Cambodia has been spared a health crisis.
“We expect growth to rebound to 5.9 per cent in 2021, boosted by supportive government policies, social assistance for the poor, and financing support for small- and medium-sized enterprises.
“These measures, along with much-needed structural reforms, will reduce the direct and indirect impacts of Covid-19 on families and businesses, and help Cambodia’s economy emerge stronger from the pandemic,” she said.