PHNOM PENH, Nov 26 - Cambodia's parliament approved a $2.4 billion national budget bill on Friday, which aims for economic growth of 7 percent next year by investing more in agriculture to boost rice exports.
The bill, backed by four-fifths of the lawmakers present, would see an 18.7 percent increase in the national budget from this year, with increased spending on agriculture and defence.
Prime Minister Hun Sen told parliament the bill would help achieve the government's target for gross domestic product (GDP) growth of 7 percent and reduce poverty by more than 1 percent each year in one of Asia's poorest nations.
He also said the budgetary increase would help keep inflation at around 4.5 percent and maintain the riel currency at around 4,100 riel to the dollar.
The 2011 bill sets aside around $23 million for the Ministry of Agriculture, up from $3 million last year, to meet plans to reform the rice sector and export one million tonnes of the grain within the next five years [ID:nSGE67G0A9].
That goal is still small compared with neighbours Thailand and Vietnam, which are aiming to ship 8.5 million tonnes and 6.1 million tonnes, respectively, this year.
Cambodia is looking for foreign investors to boost its fledgling rice milling sector so that it can reap higher dividends from its grain crop. Much is currently sent to Vietnam to be milled and re-exported [ID:nSGE6730AT].
The budget also sets aside about $297 million for defence and security spending, up from $274 million last year, which Hun Sen said was necessary for "protecting territorial integrity".
The International Monetary Fund has criticised the high level of military spending in the past and it could again be a bone of contention with international aid donors, who contribute a large proportion of Cambodia's state budget.
The Ministry of Health will get $165 million and the Education Ministry will get $218 million next year.
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