Vol 6, No 2, July – December 2021

Permanent URI for this collectionhttps://cam-ed-oar.com/handle/cam-ed-oar/661

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Macroeconomic Policies and Economic Growth of Cambodia during the COVID-19 Era
(CamEd Business School, November 30, 2021) Sereyvath Ky; Siphat Lim
The purpose of this research paper is to observe the most impacted sector among the three major contributors, including agricultural, manufacturing and service sectors on Cambodia economic growth. Additionally, the scenario analysis was employed to indicate the negative impact of the global widespread pandemic of Covid-19 on Cambodia economic growth. Responding to the research question, the VAR model which consists of the four endogenous variables, such as the real GDP growth rate, the growth rate of agricultural, the manufacturing and service sectors was run using the quarterly data from 2001:Q1 until 2019:Q4. The empirical result from the VAR model indicated that the industrial or manufacturing sector is the major contributor to Cambodia economic growth while agriculture and service respectively rank number two and three as the sectors influencing Cambodia economic growth. Furthermore, the scenario analysis indicated that in the case that all of the three sectors decrease by 5 percent quarterly for four quarters, Cambodia economic growth is expected to drop around 3.62 percent quarterly. Therefore, to minimize the impact of Covid-19 on Cambodia economic growth, the Royal Government of Cambodia is recommended to form the policy to support domestic manufacturing, especially the SMEs through increasing the regulation on the imported products that Cambodia can produce. The government should provide tax exemption and support to domestic manufacturers. Moreover, the government should provide financial and technical supports to the domestic manufacturers. Finally, the government should facilitate the improvement of the ability of domestic labor by providing vocational trainings.. Keywords: GDP; Covid-19; VAR Model; Scenario Analysis
The Effect of Export on Economic Growth in Cambodia: Policy Formulation
(CamEd Business School, November 30, 2021) Siphat Lim
The empirical result of this research has indicated that Cambodian export has a statistical significant relationship with the gross domestic product in both short-term and long-term, based on the result of Engle-Granger co-integration test and the estimated result of the Error Correction Model (ECM). The economy of Cambodia is proven to remain vulnerable, if the export of the country is negatively affected by the external shock. The evidence of the scenario analysis has demonstrated that if the export of Cambodia declines by 10% in only a quarter, the expected future of gross domestic output is expected to drop on average by approximately 1.38% per quarter which is equivalent to around 5.65% per year. Prominently, the speed of adjustment is seen to be significantly as slow as 3.33% per quarter. The synchronized policy formulation from the interviewing of the Cambodian Economists and Policymakers has advocated that the increasing of the government expenditure in developing the infrastructures, expanding and strengthening the SMEs, developing human capital, and supporting the agriculture, especially, pledging to reduce the BBC to the lowest level is the prioritized strategic plan which has to be implemented by the Royal Government of Cambodia in the short-term, medium-term and long-term to prevent the possible future economic recession and depression due to the external shock as well as to increase the level of the country competitiveness in the global market. Keywords: Co-integration test, ECM, Speed of adjustment, Scenario analysis.