Dear Editor,
In "ADB to launch $3bn fund" (May 4, 2009), the final paragraph elaborates on how governments in Asia are battling the global economic crisis. "Governments across the region have boosted spending and slashed interest rates in a bid to stimulate domestic demand to offset crashing external demand for exports."
The above assertion does not apply to Cambodia, where there has been no significant increase in government spending over the last 12 months, while interest rates have remained practically unchanged at a very high level: up to 8 percent per annum for deposits in US dollars and up to 30 percent per annum for loans also in US dollars, given that some 95 percent of the money supply is made up of greenbacks.
Even though the state budget for 2009 - as approved by the National Assembly last December ($1.75 billion) - shows a 28 percent increase on
paper over the 2008 budget ($1.37 billion), its actual implementation indicates no significant increase, if any, over last year's spending. The shortfall in expenditure is due to a shortfall in revenue associated with the current economic slump.
As of today, the government has informed the National Assembly of no plan whatsoever to update, revise or adjust its budget as a possible reaction to the current economic and financial situation, which keeps deteriorating. I am only talking about the regular state budget as adopted every year by the National Assembly. I am not referring to any special measure, budget or plan.
Contrary to all neighbouring countries, no economic stimulus package has been conceived and implemented to cope with the world economic meltdown. The government has apparently no comprehensive and consistent plan to face the unfolding crisis.
I, therefore, insist that the government shows responsibility and seriously considers the $500 million economic stimulus package that I have suggested (see "SRP calls for government bailout" in the January 19 edition of the Post).
This $500 million package would be the first emergency measure designed to alleviate the fallout from the world crisis and to prevent economic, social and political upheavals with incalculable consequences for Cambodia's stability and long-term development.
Sam Rainsy
Member of Parliament
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