IMF Team Completes the 2010 Article IV Consultation Discussions with Cambodia

Olaf Unteroberdoerster, a high ranking IMF economist for Asia-Pacific, during the press conference held in the afternoon of 10 Sept 2010 (Photo: Ly Meng Huor, RFI)

September 10, 2010
Press Release No. 10/334
Source: IMF

An International Monetary Fund (IMF) mission from Washington, D.C. visited Cambodia August 30 to September 10, 2010, to conduct the annual Article IV discussions.1 During the visit, the mission took stock of recent economic and financial developments and held policy discussions with ministers and senior officials of the Royal Government of Cambodia on their macroeconomic and financial policies. The mission also met a wide range of representatives from the business community and Cambodia’s development partners.

A broadening export-led recovery is taking hold since the beginning of the year. Real GDP growth is projected to reach 4½–5 percent in 2010, a significant turnaround from 2009. Garment exports and tourist arrivals, notably by air, are bouncing back, both growing between 10 to 20 percent (y/y) in the second quarter of 2010. Construction activity, however, appears to remain sluggish with growth of most related imports still negative, while a late start of the rainy season may dent agricultural output growth.

Amid ample liquidity in the banking system, credit growth has turned the corner and, on current trends, could run well above 20 percent in the second half of the year. Headline CPI inflation is projected to average 4 percent this year.