Logo of Phnom Penh Post newspaper Phnom Penh Post - Domestic revenue a vital source of development financing: UN report

Domestic revenue a vital source of development financing: UN report

Content image - Phnom Penh Post
Domestic revenue is an increasingly vital source of financing for development in the Kingdom, amounting to 19 per cent of gross domestic product (GDP) last year and expected to reach 22.5 per cent by end-2025. Hong Menea

Domestic revenue a vital source of development financing: UN report

Domestic revenue is an increasingly vital source of financing for development in the Kingdom, amounting to 19 per cent of gross domestic product (GDP) last year and expected to reach 22.5 per cent by end-2025, the UN said on July 16.

The UN Development Programme (UNDP) made the remark based on a report, entitled “Cambodia’s Development Finance Assessment” released on the same day.

The study, it said, “analyses the compositions and trends of all Cambodia’s financial inflows, covering public, private, international and national sources available to support development investment in the country” and “estimates the likely reductions in these flows resulting from the Covid-19 crisis”.

“While official development assistance [ODA] flows remain significant – estimated around 7.9 per cent of GDP – their composition has shifted further towards loans and within this towards less concessional terms.

“Covid-19 has led to total financing flow losses estimated to be $3.6 billion, accounting for 19.8 per cent of the total flows, for 2020. The three most significantly affected are domestic revenue, foreign direct investment [FDI] and private domestic investment.

“The report also emphasises the importance of a set of financing policy innovations to boost the capacity of the state to manage the public finances and secure ongoing high levels of private capital flows. This underscores some of the green financing mechanisms that should be explored to achieve the Sustainable Development Goals [SDG],” the UN agency said.

UNDP Cambodia resident representative Nick Beresford lauded the report as the most spot on illustration of the Kingdom’s anticipated financial inflows achieved by such a comprehensive overview.

“Once we are able to ease Covid-19 restrictions, we can expect a strong growth in development finance flows. Within those flows, domestic sources are becoming increasingly important.

“Cambodia can expect to graduate from Least Developed Country [LDC] status towards the end of the 2020s. The time to prepare new sources of financing is now as this report makes clear. For example, being able to issue bonds in Khmer riel, is an option being considered, and one strongly supported by UNDP,” he said.

Ministry of Economy and Finance secretary of state Ros Seilava emphasised that the government “plans to launch the Post Covid-19 Economic Recovery Plan 2021-2023 which will be financed by public resources while also considering mobilising additional resources from other financing options, thus this report will provide us some insights into different financing options”.

Seilava welcomed policy recommendations in the report as “another contribution of [the] UNDP to provide evidence-based policy recommendations” for the government.

MOST VIEWED

  • Wing Bank opens new branch in front of Orkide The Royal along Street 2004

    Wing Bank celebrates first anniversary as commercial bank with launch of brand-new branch. One year since officially launching with a commercial banking licence, Wing Bank on March 14 launched a new branch in front of Orkide The Royal along Street 2004. The launch was presided over by

  • Girl from Stung Meanchey dump now college grad living in Australia

    After finishing her foundational studies at Trinity College and earning a Bachelor’s degree from the University of Melbourne in 2022, Ron Sophy, a girl who once lived at the Stung Meanchey garbage dump and scavenged for things to sell, is now working at a private

  • Ministry using ChatGPT AI to ‘ease workload’; Khmer version planned

    The Digital Government Committee is planning to make a Khmer language version of popular artificial intelligence (AI) technology ChatGPT available to the public in the near future, following extensive testing. On March 9, the Ministry of Post and Telecommunications revealed that it has been using the

  • Wat Phnom hornbills attract tourists, locals

    Thanks to the arrival of a friendly flock of great hornbills, Hour Rithy, a former aviculturist – or raiser of birds – in Kratie province turned Phnom Penh tuk tuk driver, has seen a partial return to his former profession. He has become something of a guide

  • Ministry orders all schools, public and private, to close for SEA Games

    From April 20 to May 18, all public and private educational institutions will be closed to maintain order and support Cambodia's hosting of the 32nd SEA Games and 12th ASEAN Para Games, said a directive from the Ministry of Education, Youth and Sport. Cambodia will host the

  • Almost 9K tourists see equinox sunrise at Angkor Wat

    Nearly 9,000 visitors – including 2,226 international tourists – gathered at Angkor Wat on March 21 to view the spring equinox sunrise, according to a senior official of the Siem Reap provinical tourism department. Ngov Seng Kak, director of the department, said a total of 8,726 people visited Angkor Wat to