Spending only 1.4 percent of its gross domestic product (GDP) on a social safety net, Cambodia outranks ASEAN contemporaries in its relief to financially vulnerable people during the pandemic but continues to lag globally, Moody’s Investor Service reported yesterday.
Moody’s placed Cambodia in “Group 2” (the second best) out of five tiers ranking social safety nets in frontier markets. The Kingdom shared the distinction with Chile, Bosnia and Mauritius.
“Relatively high safety net spending, but programmes do not target lower-income groups leading to weaker poverty and income inequality reduction,” Moody’s said in its definition of the “Group 2” nations.
Indonesia and Vietnam were placed in “Group 3”. Thailand and Malaysia are in “Group 4”. The Philippines and Lao were placed dead last in “Group 5”.
Singapore and Brunei were not assessed.
The Kingdom has spent more than $335 million in relief to its Covid-19 Cash Transfer Programme (CCTP). The initiative is up for renewal on June 25 and is expected to continue for at least another three-month period, according to a source familiar with the matter.
“We [the government] are at a crossroads about whether we should continue with providing direct aid or targeting industries like the garment sector,” the source said under the condition of anonymity.
“We have eradicated extreme poverty and the Prime Minister has no intention of turning back and letting people suffer more than [they] already [are], so it will probably continue, but nothing is certain until he signs the document certainly,” he added.