A strong recovery in garment exports, tourism, agriculture and construction has prompted the Cambodian government to upgrade its 2011 gross domestic product growth projection to seven per cent from 6.4 per cent – its second economic upgrade in a month.
During a speech yesterday at the National Institute of Education, Prime Minister Hun Sen showed increased confidence in the Kingdom’s non-agricultural sectors, claiming GDP growth in exports, tourism and construction would exceed 10 per cent this year.
“I would like to specify that even if agricultural-sector growth was zero per cent, Cambodia’s economy would still [grow] around seven per cent,” he said at a graduation ceremony, adding, however, that a final assessment of agricultural output – ravaged by floods in September and October – would be complete in April of next year.
The government raised GDP growth from six per cent to 6.4 per cent in late September after having lowered the outlook from seven per cent to six per cent in mid-October.
Economists and officials largely shared Hun Sen’s optimism, despite flood damage that reportedly destroyed 10 per cent of the nation’s rice crop, the country’s primary agricultural product.
Higher-than-expected growth in exports, tourism and construction had upped bleaker GDP outlooks and it would probably level out at 6.4 per cent, National Bank of Cambodia director-general Ngoun Sokha said yesterday.
The export industry was expected to grow by 14 per cent this year, the service sector could grow by 4.9 per cent and agriculture was expected to expand by 1.4 per cent, she said.
Hiroshi Suzuki, an economist at the Business Research Institute for Cambodia, said increased exports highlighted the relaxing of rules of origin by the European Union.
Foreign investment has also contributed to higher GDP.