Phnom Penh, Cambodia – The Cambodian government has formally requested the World Bank to closely monitor and expedite the preparation of a special intervention package designed to address ongoing and emerging crises. This urgent appeal was made by Deputy Prime Minister and Minister of Economy and Finance, Aun Pornmoniroth, during a significant meeting with Tania Meyer, the World Bank Country Manager for Cambodia.
The discussion took place on April 21 at the Ministry of Economy and Finance. According to a press release from the ministry, the primary focus of the meeting centered on studying and identifying key measures for an immediate response to pressures stemming from the ongoing conflict in the Middle East. This new challenge comes in addition to existing crises that Cambodia has previously faced, highlighting the continuous need for robust economic resilience.
Deputy Prime Minister Aun Pornmoniroth highly commended the excellent cooperation between Cambodia and the World Bank, acknowledging its crucial role in the socio-economic development process across all stages in the country. He emphasized that the World Bank serves not only as a traditionally strong development partner for Cambodia but also as a vital “Knowledge Bank,” a repository of extensive knowledge, expertise, and diverse experiences across various sectors.
Regarding previous crisis responses, the Minister of Economy and Finance outlined Cambodia’s proactive approach. He detailed that the government has consistently formulated and implemented successive immediate measures, starting from the outbreak of the COVID-19 pandemic, addressing issues along the Cambodia-Thailand border, and continuing through to the current conflict in the Middle East. These swift interventions were primarily aimed at mitigating negative impacts on citizens’ livelihoods, supporting business activities, and ensuring Cambodia’s overall socio-economic stability.
In response to the current Middle East conflict, which is severely impacting the continuity of global energy supplies, the Cambodian government has taken immediate fiscal measures. These include absorbing the Value Added Tax (VAT) on the supply of diesel and liquefied petroleum gas (LPG) at the state’s expense. Deputy Prime Minister Aun Pornmoniroth noted that this policy has resulted in a loss of government revenue, even as there is an increased demand for additional budget allocation to support social protection initiatives.
Furthermore, Deputy Prime Minister Aun Pornmoniroth highlighted the significant findings from a study conducted by the World Bank’s expert teams. He affirmed that these results constitute a crucial input, encompassing both policy and financial aspects, for the government to review and formulate a pragmatic special intervention package. The aim is to ensure that the immediate crisis response is more targeted, comprehensive, realistic, coherent, and highly effective. This strategic approach is designed to guarantee sustainable and resilient economic growth for Cambodia in the medium to long term.
Concurrently, the Minister of Economy and Finance urged Ms. Meyer to maintain continued collaboration and dialogue with the Ministry of Economy and Finance, various development partners, and other relevant stakeholders. The goal is to accelerate the finalization of this special intervention package, ensuring its swift implementation in the near future. In response, Tania Meyer reaffirmed the World Bank’s unwavering commitment to working collaboratively with the Royal Government of Cambodia and other key development partners to prepare an even more effective immediate crisis response package.
