Logo of Phnom Penh Post newspaper Phnom Penh Post - New riel: No real change



New riel: No real change

New riel: No real change

N EW currency, to be circulated by the National Bank of Cambodia (NBC) before the end of the year, will not eliminate the US dollar, said a leading economist.

New notes will appear in denominations of 1,000, 2,000, 5,000, 10,000, 20,000, 50,000 and 100,000 riels. Coins will replace notes of 50, 100, 200 and 500 riels. However the economist predicted that the use of the dollar will diminish only insofar as the larger denomination riel notes will be less cumbersome than hitherto. He said that until political stability exists, people will continue to trust the stable purchasing power of the dollar more than the riel.

The economist, who declined to be named, said the situation was comparable to eastern Europe where the Swiss franc and Deutsche mark are widely used because of huge inflation. "In Cambodia, where inflation is about 20 percent, people hold the dollar as it won't lose value," he explained.

An NBC spokesman said the bank had decided against taking the opportunity of the new currency to knock one or two zeroes off notes. This would have enabled large transactions of riels to be made in more managable figures.

But the spokesman said most Cambodians were not yet sufficiently educated to accept such wholesale changes.

The spokesman said:"It is too problematic in terms of public budget, accountancy, balance sheets, stocks and pricing. There is still insufficient education here, and illiteracy. In France, where the denomination of the franc was reduced from 100 to 1, people are still talking in old francs more than 40 years later. In Italy, for example, they decided against reducing the lira. Many other countries, such as Indonesia, Vietnam, Russia and Poland, still count their money in denominations of 100s and 1,000s.

The actual amount of money in circulation will not change. Initial supplies will amount to approximately 15.2 billion riels, to be exchanged with existing stocks in the Treasury. Special centres, to be set up by the Bank in February or March,1995, will supervise the exchange.

New notes and coins will circulate simultaneously with old notes, which will be gradually phased out, but will continue to be legal tender indefinitely. The creation of the new currency, still to be finalised, is part of the country's move towards becoming a full market economy. The Governor of the Bank, Thor Peng Leath, will hold a press conference in the next few days to confirm details. The NBC spokesman emphasised that the new currency will not change the value of money in any way.

"The changeover will not have any effect on prices, goods or services," he said. The coins and notes are being produced in France and shipped here with the $1.6 million cost being covered by a French grant. The NBC is hoping they would arrive in time for Nov 9, Independence Day. Naturally the new currency will bear the words "Kingdom of Cambodia" rather than "State of Cambodia"

MOST VIEWED

  • Phnom Penh placed in two-week lockdown

    The government has decided to place Phnom Penh in lockdown for two weeks, effective April 14 midnight through April 28, as Cambodia continues to grapple with the ongoing community outbreak of Covid-19, which has seen no sign of subsiding. According to a directive signed by Prime Minister

  • Cambodia on the verge of national tragedy, WHO warns

    The World Health Organisation (WHO) in Cambodia warned that the country had reached another critical point amid a sudden, huge surge in community transmission cases and deaths. “We stand on the brink of a national tragedy because of Covid-19. Despite our best efforts, we are

  • Hun Sen: Stay where you are, or else

    Prime Minister Hun Sen warned that the two-week lockdown of Phnom Penh and adjacent Kandal provincial town Takmao could be extended if people are not cooperative by staying home. “Now let me make this clear: stay in your home, village, and district and remain where

  • Businesses in capital told to get travel permit amid lockdown through One Window Service

    The Phnom Penh Municipal Administration has issued guidelines on how to get travel permission for priority groups during the lockdown of Phnom Penh, directing private institutions to apply through the municipality's One Window Service and limit their staff to a mere two per cent. In

  • Vaccination open to foreigners in Cambodia

    The Ministry of Health on April 8 issued an announcement on Covid-19 vaccination for foreigners residing and working in Cambodia, directing the Ministry of Labour and Vocational Training and local authorities to register them. Health minister Mam Bun Heng, who is also head of the inter-ministerial

  • Ministry names types of business permitted amid lockdown

    The Ministry of Labour and Vocational Training singled out 11 types of business that are permitted to operate during the lockdown of Phnom Penh and Takmao town, which run through April 28. Those include (1) food-processing enterprises and slaughterhouses; (2) providers of public services such as firefighting, utility and