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© 2011 International Monetary Fund

February 2011

IMF Country Report No. 11/45

Cambodia: 2010 Article IV Consultation—Staff Report; Staff Statement and Supplement; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Cambodia

Under Article IV of the IMF’s Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. In the context of the 2010 Article IV consultation with Cambodia, the following documents have been released and are included in this package:

  • The staff report for the 2010 Article IV consultation, prepared by a staff team of the IMF, following discussions that ended on September 10, 2010, with the officials of Cambodia on economic developments and policies. Based on information available at the time of these discussions, the staff report was completed on October 15, 2010. The views expressed in the staff report are those of the staff team and do not necessarily reflect the views of the Executive Board of the IMF.

  • A staff supplement on the joint World Bank/IMF debt sustainability analysis.

  • A staff statement of October 28, 2010, updating information on recent developments.

  • A Public Information Notice (PIN) summarizing the views of the Executive Board as expressed during its October 29, 2010, discussion of the staff report that concluded the Article IV consultation.

  • A statement by the Executive Director for Cambodia.

The policy of publication of staff reports and other documents allows for the deletion of market-sensitive information.

Copies of this report are available to the public from

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700 19th Street, N.W. • Washington, D.C. 20431

Telephone: (202) 623-7430 • Telefax: (202) 623-7201

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Washington, D.C.

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Staff Report for the 2010 Article IV Consultation

Prepared by the Staff Representatives for the 2010 Consultation with Cambodia

Approved by Masahiko Takeda and Dominique Desruelle

October 15, 2010

Context: After a sharp slowdown in 2009, the economy shows signs of a recovery. However, the global crisis exposed Cambodia’s longstanding structural vulnerabilities. Chief among them are limited room for fiscal policy maneuver and effectiveness, a nascent and highly dollarized financial system, a narrow export base, and a lagging rural sector.

Policy discussions: There was broad agreement that enhancing revenue administration and stepping up public financial management reform are essential to ensure fiscal sustainability while providing room for meeting medium-term development objectives. While achieving greater monetary independence will be a gradual process, in the near term, staff advised to closely monitor the current liquidity overhang and implement high-priority FSAP recommendations. The authorities are taking steps in both areas. Staff welcomed efforts to further improve the business environment and promote rural development as they could go a long way in broadening Cambodia’s sources of growth and reduce poverty.

Meetings: Held in Phnom Penh August 30–September 10 with Deputy Prime Minister and Minister of Economy and Finance Keat Chhon, Deputy Prime Minister and Minister-in-Charge of the Office of the Council of Ministers Sok An, National Bank of Cambodia Governor Chea Chanto, Senior Minister of Commerce Cham Prasidh, and other ministers and senior officials, as well as donor and private sector representatives. The staff team comprised Mr. Unteroberdoerster (Head), Ms. Duma, Mr. Ree (all APD), Ms. Kim (SPR), and Ms. Ong (MCM, FSAP mission chief). Mr. Chea (World Bank) worked with the team on the debt sustainability analysis, in collaboration with Mr. Liu (Asian Development Bank). Ms. Vongpradhip and Mr. Phan (OED) participated in the discussions.

Exchange arrangement: The exchange regime is classified as stabilized arrangement.

Statistical issues: Some progress has been made in improving economic statistics, but weaknesses remain, in particular in the compilation of the balance of payments, external debt and disbursements, and national income accounts. Core economic data are adequate for surveillance purposes, but the delay in releasing 2009 GDP statistics is a setback.


  • I. Introduction

  • II. Outlook and Risks: Emerging from the Global Recession

  • III. Policy Discussions: Returning to Sustainable Growth

    • A. Fiscal Management: Providing Credibility and Change

    • B. Monetary and Exchange Rate Policy: Enhancing Policy Scope and Effectiveness

    • C. Financial Supervision: Mitigating Systemic Risks and Preserving Stability

    • D. Private Sector Growth: Promoting Diversification

  • IV. Staff Appraisal

  • Boxes

  • 1. Assessing the Scope for Revenue Enhancement

  • 2. Dollarization in Cambodia: Extent, Causes, and Strategies

  • 3. Key Challenges for Financial System Stability

  • 4. Cambodia’s New Rice Policy

  • Figures

  • 1. Cambodia and Its Peers—Selected Indicators

  • 2. Recent Developments

  • 3. Fiscal Indicators

  • Tables

  • 1. Selected Economic Indicators, 2005–10

  • 2. Balance of Payments, 2008–15

  • 3. Medium-Term Macroeconomic Framework, 2008–15

  • 4. General Government Operations, 2007–11

  • 5. Monetary Survey, 2007–10

  • 6. Core Financial Soundness Indicators, 2009

  • 7. Millennium Development Goals Indicators

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Joint IMF/World Bank Debt Sustainability Analysis 20101

Prepared by the staffs of the International Monetary Fund and the International Development Association

Approved by Masahiko Takeda and Dominique Desruelle (IMF) and Carlos Alberto Primo Braga and Vikram Nehru (IDA)

October 15, 2010

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Staff Report for the 2010 Article IV Consultation—Informational Annex

Prepared by the Asia and Pacific Department

(In Consultation with Other Departments)

October 15, 2010


  • I. Fund Relations

  • II. Cambodia: World Bank-IMF Collaboration

  • III. Relations with the Asian Development Bank

  • IV. Statistical Issues

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October 28, 2010

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Public Information Notice (PIN) No. 10/158


December 14, 2010

International Monetary Fund

700 19th Street, NW

Washington, D. C. 20431 USA

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October 29, 2010