ASEAN KEY DESTINATIONS
Crisis concerns grip Cambodian property market
Cambodia's real estate boom maybe coming to an end, with the global financial meltdown threatening foreign investment, national media reported Friday.
"Our property markets are closely connected with the stock markets in South Korea and other Asian countries. If these markets fall, we are affected," Kang Chandararot, the head of the economists at the Cambodia Institute of Development Study, was quoted by the Phnom Penh Post as saying.
"We will see a recession in the short term, perhaps in six to 12 months," he said.
The South Korean government issued a statement this week urging banks to sell foreign assets to increase liquidity, the Post said.
South Korea is Cambodia's biggest investor and a fall in South Korea would be especially harmful to local growth, it said.
"South Korean and other Asian markets are very closely connected to the US, and these countries are our biggest investors," said Kang Chandararot.
Cambodia's real estate sector has enjoyed unprecedented growth since 2007, but began to slide in mid-2008, industry sources say.
No figures on the depth of the declines were available, but industry experts said the crisis' impact could be felt soon.
Meanwhile, Cheam Yeap, a lawmaker with the Cambodian People's Party and chairman of the National Banking and Finance Committee, said the US crisis might affect the Kingdom's real estate market, but not the economy as a whole.
He said Cambodia's economy is sufficiently diversified in tourism, agriculture and garment manufacturing to withstand the global crisis.