A Change of Guard

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Thursday 1 December 2011

Moody’s offers update on Kingdom’s credit outlook

By Don Weinland
Thursday, 01 December 2011
The Phnom Penh Post

Improved fiscal management and preparation for a decline in foreign aid would help increase Cambodia’s credit rating, according to a quarterly credit opinion from Moody’s Investor Service, which maintained a stable outlook for the country.

Reduced exposure to crisis and stagnation in Western economies, continued foreign direct investment and development in the oil and gas sector offered the chance to up the outlook, according to the report issued on Sunday.

However, it warned of a dearth of debt transparency.NGO Forum on Cambodia showed the country owed US$2.4 billion in concessional loans as of October.

The Moody’s update, however, said total government debt stood at $5.2 billion this year. Only concessional loan figures and interest rates are available to the public, Chea Kimsong, manager of the development issues program at the NGO Forum, said yesterday.

The government does not publish non-concessional and commercial loan data, he said, leaving more than $2.8 billion unaccounted for.

“It’s an issue affecting how we can predict the country’s future debt and national budget,” Chea Kimsong said, adding that the Ministry of Economy and Finance had recently pledged to issue a “debt bulletin”.

The regular publishing of debt stock as is done by other ASEAN countries such as Thailand and the Philippines could attract investment, Christian de Guzman, one of the Moody’s analysts who issued the update on Cambodia, said yesterday via email.

“I believe greater transparency would bolster investor confidence and would be credit positive,” he said.

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