World Bank: Cambodia's economy hit hard by Kovid-19 outbreak
Cambodia's economy has been hit hard by the Kovid-19 outbreak. This is the emphasis of the World Bank in its new report on "East Asia and the Pacific in "Kovid-19 period." According to the scenario, the Cambodian economic growth line in 2020 is projected to decline sharply to 2.5 percent, but it will recover to 5.9 percent in 2021. But in another scenario, if the Kovid 19 crisis continues, Cambodia's economic growth could slow to one-half. Only one hundred in 2020 before rising to 3.9 percent in 2021.
In a report released on March 13, the World Bank claimed that the 19-Kovid outbreak had shaken the world in an unprecedented state. Serious impact on the Cambodian economy. The eruption caused Cambodia's major economic growth engines to slow down sharply in the first quarter of 2020, especially in tourism and construction. Similarly, the garment industry is facing a crisis of declining global demand as well as pressure from the EU's EBA system. And if the impact extends to the construction and real estate sectors while the financial sector is in turmoil, it could have a devastating effect on Cambodia's economic growth. However, the World Bank says the recovery in economic activity in China and other major markets in 2021 will improve Cambodia's economic outlook next year.
Nevertheless, the projected outlook for Cambodia's economic growth still faces risks and challenges ahead. If the Kovid 19 virus persists for a long time, the number of tourists visiting Cambodia will continue to decline, and global economic activity will recover. Again, the industrial sector in Cambodia is less active due to the lack of demand for garment exports. Foreign direct investment will fall sharply due to prolonged turmoil in financial markets and sluggish construction. In such a scenario, the actual growth of the Cambodian economy is projected by the World Bank to slow to only 1% by 2020. Before recovering to 3.9 percent in 2021.
In conclusion, the World Bank said that in this circumstance it is important to implement macroeconomic precautions, such as restricting bank lending to the construction and real estate sectors. Except in the case of first-time buyers, all of these help to mitigate the potential impact of changes in the real estate market. Monetary measures recently introduced include reducing deposit requirements, benchmark rates and cash coverage ratios.
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