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World Bank revises 2013 growth figures

World Bank revises 2013 growth figures

The World Bank has revised its growth prediction for Cambodia upwards to 7 per cent for 2013, from its January prediction of 6.7 per cent, a revision it attributes to the performance of the Kingdom’s agriculture, tourism and garment sectors.

Cambodia’s outlook is generally positive, according to the World Bank, which expects inflation to remain at 3 per cent in 2013.

Though it has eased slightly, credit growth “continues to raise concerns” for the bank, which called for “close monitoring” of the situation.

“Credit growth . . . has been driven largely by wholesale and retail financing . . . starting in 2011 agriculture financing has eased to 29.2 per cent (year on year) in January 2013, from 34.0 per cent in December 2012, and 34.6 per cent in January 2012,” said the World Bank.

While acknowledging the level of banking integration in Cambodia – demonstrated by the “large presence” of foreign banks – the IMF was also cautious about maintaining effective controls on credit growth.

“Going forward, it is important for Cambodia to manage financial deepening while ensuring financial stability. For that, moderating credit growth and continued supervisory and regulatory improvement would be necessary,” Faisal Ahmed, the IMF representative for Cambodia, told the Post two weeks ago.

Having ceased loans to Cambodia in 2011 after concerns about the forced evictions at Boeung Kak lake, the World Bank told the Post in December last year that it would wait until after this year’s general elections to discuss re-introducing loans.

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