Phnom Penh (FN), May 28 – Cambodia´s resident representative for the IMF and Senior Economist Yasuhisa Ojima said that the Cambodian economy is expected to grow 4.2 percent this year and 6 percent in 2022, following a 3.5 percent contraction in 2020.

His statement was made at the Association of Banks in Cambodia’s first CEO Forum under the theme “Economic Outlook and COVID Recovery of Cambodia and the ASEAN Region.”

Ojima added that the baseline growth projection will be revisited reflecting the recent surge in infection of COVID19 or a so-called February 20 Community Event.

Financial sector looks stable mainly due to policy measures with easing financial conditions (LPCO, lower reserve requirement), and allowing loan restructuring until end of December 2021. However, uncertainties remain especially for credits to real-estate and construction sector (including from shadow-banking system) and tourism sector, Ojima added.

He also reiterated that as long as uncertain remain high, policy restricting capital distributions would be warranted on grounds of prudence.

Chairman of the Association of Banks in Cambodia Dr. In Channy said that the time for this discussion is most relevant at this time of economic distress. While the National Bank of Cambodia (NBC) had just extended the restructuring efforts until the end of 2021, all financial institutions are still in need to understand how the Cambodian economy will evolve over the next few years.

“With many borrowers experiencing difficulties to make their loan payments and circa 12% of all loans restructured, an economic recovery is of outmost importance for borrowers as well as the financial institutions alike,” Dr. Channy added.

He continued that: the insights and prognoses by IMF will certainly help our institutions to prepare and to ensure the stability and long-term prosperity of our sector.
=FRESH NEWS