Op-ed: Cambodia’s 36.5 Tonnes of Gold, US$19 bln International Reserves, Encourages More Investments
AKP Phnom Penh, July 27, 2020 —
Cambodia’s healthy gold reserves add to the country’s key elements, such as peace, political stability, and macro-economic development to re-affirm that Cambodia’s overall position is still in good shape. These suggest more investments should move to the Southeast Asian nation since she opened the country’s economy to all investments from every corner of the world.
The Royal Government of Cambodia has been doing its utmost in many ways to serve the interests of the country and its people and ensure that Cambodia is ready for mutual cooperation as she diversifies free trade deals with countries in Asia and elsewhere.
Some would argue wrongly, that the amounts of gold held by Cambodia are small. It includes 12.4 tonnes of gold inherited from the post-Cambodia’s wars and deposited with a Swiss bank, another 14.1 tonnes of gold stored in the Bank of England vaults, and 10 tonnes of gold retained in Cambodia.
But, it is quite big deal for a small country like Cambodia which has more than 15 million population and a GDP of US$27.1 billion.
The government is also good at saving, as proven by the fact that more than US$3 billion surplus is recorded. So, when the government reduces its budget 50 per cent for next year, it is a political decision on the country’s priority for development and other needs.
It is also a big chunk when it comes to its US$19 billion international reserves, as stated by the National Bank of Cambodia on July 23, 2020. It means more than just the amount of gold and billions of international reserves, it is the country’s good image of governance under the great leadership of Prime Minister Hun Sen, who sent a clear and loud message to the outside world that Cambodia is very committed to transparency and accountability.
That also means that national and international investors should take a closer look at the Kingdom of Wonder on its investment radar in the region, more than just the 10-country block ASEAN, with its more than 600 million populations. Yet, once you invest in Cambodia your market is much larger than that of ASEAN alone because ASEAN has more free trade agreements with countries, such as the Republic of Korea (South Korea), China, Japan, India, and others.
Phnom Penh is to ratify the free trade deals between ASEAN-Hong Kong, China, India, and elsewhere to further open Cambodia’s market overseas.
Cambodia’s peace, political and macro-economic stability are there; while the government is improving its domestic reform, making friends near and far, based on equal footing, along respect for one another’s independence and sovereignty.
Today, the government is amending its related laws and regulations for investment to facilitate trade and investments in the context of the globalisation. Cambodia’s new investment law is expected to be online soon.
Cambodia-China Free Trade Deal
Prime Minister Hun Sen will lead a delegation to China, where the two trade and commerce ministers will sign the trade deal, expected to be in place before mid-August 2020. This move will attract not only Chinese investment to Cambodia, but others; given that two-way trade increased to more than US$7.4 billion in 2018 and is targeted to reach US$10 billion in 2023. It was more than US$6 billion in 2017 from US$5.16 billion in 2016.
The country’s inflation rate is still relatively low at 2.8 per cent in recent years and the foreign exchange rate is steady at around 4,100 Riel to the US dollar. Cambodia also has potential manpower attractive to investors – a young population that represents about 70 per cent of its total population.
In this respect, more investments should be ready to move to the Kingdom of Wonder where the country has enormous potential in tourism, agroindustry, garment, education, among sectors on a first come, first serve basis.
Cambodia brings together potential and opportunity, to fulfill investors’ needs and goals for future growth.
By Ek Tha
Spokesman of the Council of Ministers’ Office,
Advisor to the Ministry of Information,
Standing Vice-Chairman of the Royal Government Spokesperson Unit.