Cambodia's fuel subsidies to cost 300 mln USD in 2008

PHNOM PENH, May 28, 2008 (Xinhua via COMTEX) -- -- With discontent growing over rampant inflation, the Cambodian government has claimed it will spent 300 million U.S. dollars on fuel subsidies in 2008, local media reported Wednesday.

"We are trying to control inflation which is a phenomenon that influences Cambodia from outside by subsidizing gasoline," Keat Chhon, Cambodian Minister of Economics and Finance, was quoted by the Mekong Times newspaper as saying.

Keat Chhon predicted the subsidies would cost the state 300 million U.S. dollars by year's end, the newspaper said.

The government still imposes the same tax on oil - 309 U.S. dollars per ton for gasoline and 267 U.S. dollars for diesel - despite the fact imported oil has currently increased price to over 1,000 U.S. dollars per ton, Keat Chhon said.

"Currently, we do not take tax freight and insurance even though the oil price is rising," he added.

The Cambodian government claimed last month it had spent 29 million U.S. dollars on gasoline subsidies so far this year.