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IMF offers economic outlook on Cambodia
The International Monetary Fund (IMF) issued a report using macroeconomic frameworks to analyse the economic shock that COVID-19 has had on two countries: Cambodia and Colombia.
The IMF team built a simulation model based on the Cambodian economy to project the short and medium-term impacts of the pandemic.
Three assumptions were used to carry out the model. Those assumptions were recessions in countries which trade with Cambodia affected demand for Cambodian exports and led to a massive decrease in tourists, domestic supply and demand were affected by this and that the government will employ some kind of fiscal stimulus to counteract the first two assumptions.
The report predicted that domestic demand will decrease by two percentage points in 2021 and that the country’s risk premium will increase by 200 basis points in 2021 due to “tighter financial conditions.” It also predicted a rise in food prices due to hoarding.
The report also pointed to a potential gradual economic recovery starting this year.
“The economy will start recovering in 2021, growing at more than two percent and in 2022 closing the output gap,” the report said.
Source: https://www.khmertimeskh.com/50833827/imf-offers-economic-outlook-on-cambodia/