2010 Economical Perspectives
Young Cambodians are optimistic about their countries’ development
Young Cambodians are rather optimistic about their own country and they think it is going in the right direction in what has to see with development. It is the conclusion of the US International Republican Institute (IRI) in its July 31 – August 26, 2009’s Public Opinion Survey on Cambodia that was released this month.
The survey (it can be found at http://www.iri.org) gathered a sample of 1,600 Cambodians older than 18 years old from the 24 provinces and a separate group of 400 Muslim Cambodians. Officials and their families were excluded from the survey.
The 79 % of the inquired persons considers that Cambodia is going to the right direction because it has now more roads (76 %), more schools (61 %), more health clinics (29 %), more pagodas (21 %), more bridges (17 %), less poverty (17 %), more irrigation built (16 %), better water and electricity supply (11 %), good business environment (11 %) and more peace (11 %).
|Right direction||81 %||84 %||77 %||81 %||77 %||74 %|
|Wrong direction||18 %||16 %||22 %||19 %||23 %||25 %|
|DK / NA||0.4 %||0.4 %||1 %||0.3 %||0.0 %||2 %|
|Age range||18 – 24||25 -29||30 – 39||40 – 49||50 – 59||60 and older|
The 21 % says that the country is going in the wrong direction because there is more corruption (38 %), still poverty (29 %), prices of goods are too high (29 %), nepotism (29 %), prices of crops are low for farmers (17 %), business is doing poor (13 %), gasoline and energy is too high (12 %), not enough jobs (12 %), threats to take land from people (11 %) and poor infrastructure (10 %).
Are you and your family richer, the same or poorer than one year ago? Do you think that you and your family will be richer in one year more?
The 25 % said that they rose their incomes in the last year, the 36 % said that it remains the same and the 39 % concluded that they are poorer this year than before.
The 40 % thinks that they will be richer in one year more, the 32 % the same, the 20 % poorer and the 8 % did not answer.
Cambodia 2010: Recovery or Recession
The first decade of the century was of a great challenge in economy for Cambodia. It was not only the reconstruction of a devastated nation, but it showed a lot of potentials, not only in natural and even technological resources, but in human potentiality.
The 2009’s global crisis meant also a test to that previous economical growing. But it will be this year where Cambodia will demonstrate how real was the previous growing.
1999 – 2008 was a period of great transformations in the economy as the increase in population, rural migration to cities, more infrastructures and the integration of the country in global markets. Even if today 1/3 of its population still under the line of poverty, it is true that in that period there was a considerable reduction.
Is it a time for investment in Cambodia?
Investment has been affected by the 2009’s global crisis. Although there is an optimism, it is not possible to forget that 2010 is the year of the recovery. It is predictable that investment still a good idea in a country that appears promissory and welcoming. Cambodia is in the 60th position of investment freedom in the scale of the 2010 Index of Economic Freedom of the Heritage Foundation (http://www.heritage.org/Index/country/Cambodia) – the study contemplates 179 countries, therefore, the position is quite positive.
According to the study of the Heritage Foundation, foreign and domestic capital are treated equally in most sectors in Cambodia and only few sectors subject foreign investment with conditions, local equity participation or prior authorization from authorities.
Foreign investment is promoted nowadays by the government that sees it as a way of development. Companies are allowed 100 % foreign-owned to trade as long as they are registered at the Ministry of Commerce.
However, a non-transparent court system could be one of the main obstacles for investment, according to Heritage Foundation. By other part, foreigners have not restrictions in foreign exchange accounts, they can lease but not own land and the government may expropriate property only in the public interest and with advance compensation.
The more depressed sectors in 2009 were construction and garment factories. While construction seen not to rise the head, certain signs would be of hope for garment. Tourism and agriculture, by their part, will be the stars of the year in Cambodia due to best prices of rice and the evident improvement in the tourism infrastructure around the country.
Other good sign for investment is the growing optimism of Cambodians and their will to reduce poverty. The country is looking for new markets around the world, regional integrations, a sustainable management of natural resources and investments in agriculture, infrastructures, education and higher savings.
It is almost sure that agriculture will be the strongest sector in 2010 in Cambodia, a sector that makes the 31.8 % of the GDP, according to official numbers. It is a good news for the rural areas if policies to improve the standard of life of farmers will be implemented. National projects to develop rural infrastructures and looking for new international markets are on the way. Cambodians are talking already in the terms of competitiveness and the diversification of agriculture.
How was tourism in 2009
International tourism saw a global reduction due to the financial crisis. It was particularly felt in a country that began a growing process of tourist industry development since 2004. But we can consider that the effects of the global recession were not so terrible in the Cambodian tourism as it was in nearby countries with a longest tourist tradition. As Cambodia is a relative new international destination, the country still adaptable to reductions.
The development of infrastructures for tourism has been especially important in the main tourist spots, but in certain cases it seems that there is the idea to copy tourist models of neighboring countries, while forgetting that what makes Cambodia especially attracted to foreigners is its natural environments.
It is also a cheap destination for most international visitors. Norms to control the inflation of prices to foreigners were reinforced in the last year, keeping that especial attractive of an economical place to visit. A tourist backpacker finds now guest houses from 4 to 15 American Dollars.
Cambodia is well regarded as a safe place in most of its provinces. Criminality can be considered at its tolerable level and foreigners who are victim of violence are circumstantial. In 2009 the number of homicides per 1,000 persons in Cambodia was of 2, according to the Global Peace Index, that is a very low level of violence.
In January 2009 a number of 218,691 foreign visitors entered the Kingdom and 105,701 of them arrived in the Siem Reap International Airport, it is the 48.3 % of the total.