Economy

Ministry Pledges $100m to Help Covid-hit Sectors Grow

Cambodian SMEs and agriculture sectors given a $100 million lifeline to boost business, as the sectors are singled out as being key drivers to help the nation’s post-covid economic recovery.
SMEs represent 98 percent of businesses in Cambodia, contribute 58 percent to GDP and provide 73 percent of employment of the total labor force. Picture: Sam
SMEs represent 98 percent of businesses in Cambodia, contribute 58 percent to GDP and provide 73 percent of employment of the total labor force. Picture: Sam

Cambodia’s small and medium enterprise (SMEs) and agricultural sectors have been given a cash injection after the Ministry of Economy and Finance pledged $100 million to spur growth.

The Ministry made the announcement on Monday as the latest measure to offer respite to sectors that have been severely affected by the Covid -19 pandemic in the past two years.

In a virtual speech, Minister of Economy and Finance, Aun Pornmoniroth, said the fund is part of the implementation of the Strategic Framework and the Cambodian Economic Growth Rehabilitation Program to live with Covid 19 in a new normal for 2021-2023.

“For today, the $100 million will be used to promote agriculture and SMEs that are two important sectors in national economy in creating jobs, improving people’s lives and increasing national economic growth,” said Pornmoniroth at the Dissemination Ceremony on the Additional Fund Allocation for Small and Medium Enterprise Bank of Cambodia and Agricultural and Rural Development Bank.

He said the SMEs, which represent 98 percent of businesses in Cambodia, contribute 58 percent to GDP and provide 73 percent of employment of the total labor force.

“Cambodia has been severely affected by the Covid-19 crisis, which has slowed down the development of socioeconomic development and public health,” he added.

In 2020, the Cambodian economy shrunk by 3.1 percent due to the sharp decline in key sectors, such as tourism, construction and real estate, while the agricultural sector-maintained growth, Pornmoniroth said.

Private enterprises, especially SMEs in the services sector, were also impacted severely, he said. He added that Cambodia’s economy is estimated to see a slight recovery in 2021, achieving around 3 percent growth. This is due to the full reopening of the country during the fourth quarter of last year.

Pornmoniroth said the surges of Omicron have caused new challenges that may harm growth and create fear among the public. He urged all stakeholders, private and state, to continue implementing health measures to help cut down infections, protect people’s lives and avoid negative impact to the Cambodian socio-economy.

Cambodia reported 512 Covid cases on Monday, all Omicron, in a new surge in recent months despite no deaths reported for almost two months.

On Sunday, Or Vandine, a spokeswoman at the Ministry of Health, said on Twitter that complacency about Omicron will create a further surge of virus transmission in the community. She urged people to get vaccinated and urged strict health protective measures.

“Act together to stop or suppress Omicron transmission in our community now to show and share your good heart with your loved one without regret by bringing them to get vaccinated asap. Thank you for caring for your loved one to avoid infection by Covid-19. More Omicron cases are detected now,” she said.