Inflation Will Go Down Later this year, Economy Minister Said

By Sok Lak

The consumer price increased by a total of 7.1 percent in June 2011 compares to last year the same prior. The Ministry of Economy and Finance expected that the inflation would go down to 6.5 percent at the end of this year under its strict measure to deal with the problem.

“I expect that inflation will go down to 6.5 percent at the end of this year while the inflation remains 7.1 percent in this month,” H.E. Keat Chhon, Deputy Prime Minister and Minister of Economy and Finance, told media after climate change workshop on August 30. “The past few months are the season when inflation used to be high at the group of food and goods of consumer in cities, he emphasized.

“However, the increasing price of latex or rubber, rice, and cassava in rural area is the benefit of local producers, because earn more from that yield,” the minister said, adding that to response the increasing of inflation, the Ministry of Economy and Finance is try to control the price. He added: “We keep it from increasing so fast because these increasing prices of food and goods for local consumers will affect the price of exporting, especially the increasing price of gasoline,” he stressed. “All governments around the world cannot avoid the increasing price of gasoline, so all people in country need to deal with problem especially rural areas, where there is a need to expand agricultural productivity and growth of yields so that most of the people will not be easily affected by inflation.”

According to report from the institution of Statistic showed that the main groups to increase the inflation rate are the group of food and no alcoholic beverages, alcoholic beverages, tobacco and narcotics, clothing and footwear, transport, restaurants, and miscellaneous goods and services.

The report said that the total consumer price increased by 7.1 percent from June 2010 to June 2011 while 4.4 percent units were due to increased by 8.9 percent for food and non-alcoholic beverages. Among them, price for meat increased by 13.9 percent which contributed by 1.5 percent units, price for pocks increased by 16.8 percent which contributed by 1.1 percent units.

Moreover, the price for beef increased by 11.7 percent which contributed by 0.3 percent units, price for seafood increase by 11.7 percent which contributed by 1.1 percent units, price for fresh increased by 11.8 percent which contributed by 0.9 percent units, price for oils and fats increased by 9.3 percent which contributed by 0.9 percent units, price for gas increase 20 percent which contributed by 0.6 percent unit, price for restaurant increased by 10.9 percent which contributed by 0.8 percent unit, price for gasoline increased by 16.4 percent which contributed by 0.7 percent units. The price of gasoline in the country is up or down depending on the oil price at international markets. But it is a bit strange for oil and gasoline prices to behave this way in Cambodia, where local consumers always complain about it.

Usually, when gasoline price at international markets go down, local oil distributors never dropped its costs on time due to citing that they brought it with high prices, so they need to sell at a high price too. In contact, they will increase price of gasoline on time while it is up at the international market. Currently, the price of gasoline is worth about US$ 1.3 per liter, Commerce Minister, H.E. Cham Prasidh, said recently that Cambodia’s economic growth will be at 8 per cent this year. The economic growth of Cambodia depends on four pillars-garment and textiles, tourism, construction and agriculture in the previous years. The agricultural field is the greatest potential for the country, while plans to export one million tons of milled rice product by 2015.

Source: The Southeast Asia Weekly, September 4-10, 2011, Vol 5, Issue 36, Page 6