IMF predicts strong economic Growth in 2005

Despite earlier gloomy predictions, the International Monetary Fund now predicts strong economic growth in Cambodia in 2005 as the end of the worldwide garment quota system will apparently have almost no impact on Cambodia this year, according to Agence Kampuchea Presse.

IMF Deputy Director for Asia, announced Tuesday that the IMF now predicts Cambodia's gross domestic product will grow at 6 percent in 2005, up from the 2.3 percent GDP predicted late last year.

"The main contribution to the revision is garment exports. Recent developments in the markets have given Cambodia actually some breathing space which it can use to improve its competitiveness", he said, adding that the IMF also forecasts 6 percent growth in 2006.

He also said that an unanticipated construction boom in Cambodia and a less severe drought than feared had also contributed to the higher growth estimate. In the first quarter of 2005, despite surges of garment exports from China onto world markets, Cambodia still managed to export 16 percent more than in the first quarter of 2004, according to Ministry of Commerce data.

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