Hong Vannak, an economist at the Royal Academy of Cambodia (RAC). PHOTO SUPPLIED
The National Assembly convened its inaugural session of its 7th legislative term on August 22, endorsing the Cabinet lineup led by Prime Minister Hun Manet. Manet outlined his government’s strategy, encompassing all sectors.
Reporter Van Socheata engages in a discussion with Hong Vannak, an economics researcher at the Royal Academy of Cambodia’s (RAC) International Relations Institute, to gain insights into Cambodia’s economy under the new government.
What are your thoughts on the new government under Manet’s leadership?
While the new administration has almost completely replaced the old one, I believe that there have been no significant changes politically, economically, culturally, or socially. I hold an optimistic view that this fresh change might prove energetic and yield improvements. The new administration possesses the potential to embrace innovation, as the previous government laid the groundwork for achievements. Hence, the immediate task for the new government is to continue ongoing efforts both economically and politically, while also smoothly executing new initiatives.
From an economic standpoint, do you anticipate that this leadership change will substantially impact the previously projected national economic growth?
Economically, I’m inclined to believe it could be advantageous. Firstly, the new leaders, who hold Western economics degrees and have served at the Ministry of Economy, are highly capable individuals. Given their expertise, they could elevate Cambodia’s economy to new heights.
I have confidence in the new government’s ability. I am of the opinion that the Cambodian economy will not be negatively affected. As mentioned earlier, our economic legacy and foundation provide a strong basis for development.
With minimal changes in the Ministry of Economy’s leadership, it’s evident that the existing leadership is well-experienced and proficient in economic matters. Coupled with the economic competence and knowledge of the new prime minister, I am convinced that Cambodia’s economy will experience robust growth.
In your view, which sector should the new government prioritise and why?
There are three pivotal sectors that demand the government’s close attention.
Firstly, the agricultural sector needs to explore opportunities for Cambodian agricultural production, encompassing both crops and animal husbandry. Our focus should extend beyond domestic demand, incorporating exports and local processing, particularly given the global food security concerns. Cambodia holds immense potential in agriculture, and by enhancing regional and national products, foreign orders and sales will inevitably increase.
Secondly, the industrial sector warrants consideration, especially in relation to Small and Medium-sized Enterprises (SMEs), which are closely intertwined with agriculture.
In addition to the established garment sector, we should identify other sectors capable of supplementing or substituting the earnings from our existing garment, footwear, and clothing industries.
Furthermore, the attraction of heavy industries like chip manufacturing and automobile production, including tires, is a consideration for the new government. These industries hold higher value and align well with Cambodia’s expanded infrastructure, including transportation systems.
The third sector is tourism, heavily impacted by the Covid-19 pandemic. The new government and relevant stakeholders must strategise on ways to reinvigorate international tourism, especially as the global crisis subsides.
When these three sectors operate smoothly, others areas such as finance, banking, and real estate are poised for automatic growth.
What recommendations do you offer to the new government, especially for effective leadership in reviving the national economy post Covid-19 and the global crisis?
From my perspective, the situation is not complicated, given the foundation laid by the previous government. It was already substantial and not in a state of deterioration.
An active economic scenario will continue progressing incrementally, making recovery straightforward for the new government by introducing new indicators, as previously mentioned.
I foresee growth in the Cambodian economy. With high activity in these three sectors, increased incomes, employment opportunities, and tax contributions will follow. This signifies economic growth. Over the next decade, Cambodia is poised for a significant transformation on regional and international platforms.
