World Bank2014-04-152014-04-152014-04-02https://hdl.handle.net/10986/17784Cambodia's economy has withstood domestic pressures and managed to sustain its high growth driven by its usual engines of growth. The external sector improved as a result of slower imports due to dampened domestic demand. The post-election adverse effects slowed down the demand for imports, while export growth advanced. Inflation rose to 4.7 percent year-on-year at the end of 2013, up from 2.5 percent at the end of 2012. Inflation is projected to remain in mid-single-digits over the short term. Financial deepening continues but the gap between credit and deposit growth rates has widened, reducing bank liquidity. Government revenue growth has moderated, resulting in an increase in the fiscal deficit. The latest joint World Bank and International Monetary Fund (IMF) debt-sustainability analysis (DSA) conducted in 2013 shows that Cambodia's debt-distress rating remains low, with all debt-burden indicators projected to be below respective thresholds. The prospects for sustaining high growth appear favorable, and real growth for 2014 is projected to reach 7.2 percent, given expectations of renewed confidence and political stability, underpinned by the strengthening of the economic recovery in developed economies. Appropriately managing domestic pressures in order to gain from the improved global economic environment will help maintain macroeconomic stability. Enhancing regional integration will also enable Cambodia to benefit more from the growth dynamics throughout the Association of Southeast Asian Nations (ASEAN) region. While Cambodia does have some fiscal space to increase wages, a cautious and careful approach to pay raise may work best.en-USCC BY 3.0 IGOADVERSE EFFECTSANNUAL BUDGETSARREARSBANK LIQUIDITYBANKING SYSTEMBILLBROAD MONEYBUDGET ALLOCATIONSBUDGET CLASSIFICATIONBUDGET DATABUDGET DOESCAPITAL EXPENDITURECAPITAL FLOWSCAPITAL SPENDINGCAPITAL STOCKCENTRAL BANKCENTRAL BANKSCIVIL SERVANTSCIVIL SERVICECIVIL SERVICE REFORMCIVIL SOCIETY ORGANIZATIONSCOMPETITIVENESSCONSOLIDATIONCONSUMER PRICE INDEXCONTINGENT LIABILITYCONTROL SYSTEMSCREDIT GROWTHCURRENT ACCOUNTCURRENT ACCOUNT BALANCECURRENT ACCOUNT DEFICITCURRENT ACCOUNT DEFICITSDEBTDEBT BURDENDEBT MANAGEMENTDEBT SERVICEDEBT SUSTAINABILITYDEFICITSDEPOSITDEPOSIT MONEY BANKDEPOSIT MONEY BANKSDEPOSITSDEPRECIATIONDEVELOPING COUNTRIESDOLLAR EXCHANGE RATEDOMESTIC CREDITDOMESTIC DEMANDDOMESTIC REVENUEECONOMIC DEVELOPMENTSECONOMIC ENVIRONMENTECONOMIC GROWTHECONOMIC RECOVERYECONOMIC SLOWDOWNEQUIPMENTEXCHANGE RATEEXCHANGE RATE TARGETINGEXCHANGE RATESEXPENDITUREEXPENDITURESEXPORT GROWTHEXPORT MARKETSEXPORTEREXTERNAL DEBTEXTERNAL FUNDINGEXTERNAL POSITIONFIDUCIARY ASSESSMENTFINANCIAL ACCOUNTFINANCIAL CONDITIONSFINANCIAL CRISISFINANCIAL INTERMEDIATIONFINANCIAL MANAGEMENTFINANCIAL MARKETSFINANCIAL POSITIONFINANCIAL SECTORFINANCIAL SECTOR DEVELOPMENTFINANCIAL SECTORSFINANCIAL SYSTEMFISCAL AFFORDABILITYFISCAL CONSOLIDATIONFISCAL DEFICITFISCAL POLICYFISCAL REPORTINGFISCAL SHOCKSFIXED ASSETFOOD PRICESFOREIGN ASSETSFOREIGN CURRENCYFOREIGN DIRECT INVESTMENTFOREIGN EXCHANGEFOREIGN EXCHANGE RESERVESFOREIGN TRADEGLOBAL ECONOMYGLOBAL TRADEGOLDGOVERNMENT DEPOSITSGOVERNMENT EXPENDITUREGOVERNMENT EXPENDITURESGOVERNMENT REVENUEGOVERNMENT REVENUESGOVERNMENT SAVINGSGROWTH RATEGROWTH RATESHIGH-INCOME COUNTRIESHOLDINGSHUMAN RESOURCEIMPORTIMPORT GROWTHIMPORTSINFLATIONINFLATION RATESINFLATIONARY PRESSUREINTERNAL CONTROLINTERNAL CONTROL SYSTEMSINTERNATIONAL RESERVESINVESTMENT PROJECTSLABOR MARKETLENDERLENDER OF LAST RESORTLIABILITY MANAGEMENTLOANLOCAL CURRENCIESLOCAL CURRENCYLONG-TERM INTERESTLONG-TERM INTEREST RATESLOW-INCOME COUNTRIESLOW-INCOME COUNTRYMACROECONOMIC MANAGEMENTMACROECONOMIC POLICYMACROECONOMIC STABILITYMAJOR CURRENCIESMARKET INSTABILITYMICROFINANCEMICROFINANCE INSTITUTIONSMINISTRY OF ECONOMYMINISTRY OF FINANCEMONETARY POLICYMONETARY SECTORMONEY GROWTHMORTGAGEMORTGAGE-BACKED SECURITIESMULTINATIONAL COMPANIESNATIONAL AUDITNATIONAL BANKNOMINAL EXCHANGE RATEOIL PRICESOTHER CURRENCIESPEGPERFORMANCE MANAGEMENTPETROLEUM PRICESPOLITICAL STABILITYPOLITICAL UNCERTAINTYPOST-CRISIS PERIODPOVERTY REDUCTIONPRIVATE SECTORPROVINCIAL EXPENDITURESPROVINCIAL LEVELPRUDENTIAL REGULATIONSPUBLIC EXPENDITUREPUBLIC EXPENDITURE REVIEWPUBLIC FINANCIAL MANAGEMENTPUBLIC INVESTMENTPUBLIC SECTORPUBLIC SERVICEPUBLIC SERVICE DELIVERYPUBLIC SERVICESPUBLIC SPENDINGPUBLIC WORKSREAL EFFECTIVE EXCHANGE RATEREAL ESTATE INVESTMENTREAL ESTATE INVESTMENTSREAL EXCHANGE RATEREAL GROWTHREFORM PROGRAMREGIONAL INFLATIONREGULATORY FRAMEWORKREMUNERATIONRESERVESRESOURCE MANAGEMENTRETURNREVENUE GROWTHREVENUE TARGETSECTORAL ALLOCATIONSECTORAL ALLOCATIONSSECTORAL BREAKDOWNSERVICE FACILITIESSHORT-TERM DEBTSHORT-TERM INTEREST RATESTRUCTURAL REFORMSSURPLUSESSUSTAINABILITY ANALYSISTAXTAX ADMINISTRATIONTAX BASETAX COLLECTIONTAX REVENUETAX REVENUESTOTAL CREDITTOTAL EXPORTTOTAL IMPORTTOTAL IMPORTSTOTAL INVESTMENTSTRADE BALANCETRADE DEFICITTRADE DEFICITSTRADE FACILITATIONTRADE SURPLUSTRADINGTRADING PARTNERSTRANSPARENCYTREASURYTREASURY SECURITIESWAGE EXPENDITUREWAGE EXPENDITURESWAGE POLICY10.1596/17784