The government must provide a $500 million stimulus package for the Cambodian economy to avoid further effects from the global financial crisis, SRP President Sam Rainsy wrote in a Friday letter to National Assembly acting President Nguon Nhel.
“The current situation in Cambodia is showing the global effects as the price of crops has declined, farmers’ incomes have declined, real estate prices have dropped, construction projects [have] halted, garment factories have closed and people are experiencing a lower standard of living because of inflation,” Sam Rainsy wrote.
The $1.8 billion in the 2009 budget doesn’t do enough to respond to the financial crisis, he wrote, adding that neighboring Vietnam and Thailand have already released economic stimulus packages.
“I would like the government to consider taking appropriate measures in order to support Cambodia’s economy,” he wrote. The money can be procured from loans or international aid and should be spent to support farmers, build infrastructure, reduce taxes and give loans, he wrote.
Information Minister and government spokesman Khieu Kanharith said Sunday that the government has already reserved budget money to mitigate the effects of the crisis.
“Sam Rainsy doesn’t work so he doesn’t know about the budget law,” he said.
Chan Sophal, president of the Cambodian Economic Association, said an infusion of government money could speed economic growth to levels seen before the crisis began.
“Cambodia is about to take off but now we are short of fuel,” he said. “I think any plans to inject more cash into the economy would really help to reverse the downward trend.”
Cambodia will likely recover regardless of whether such moneys are secured, he added, but “it will take longer without the cash.”