‘Riel-ing’ in loans is key to de-dollarisation

[geovalin]

The use of the US dollar is a remnant of the Khmer Rouge regime, symbolising the degradation of global confidence in Cambodia’s economic system. It is a daily reminder of the brutality that occurred during the civil war. “More than economic development, the use of the riel is a matter of our national pride,” said In Channy, chairman of the Association of Banks in Cambodia.

 

Channy is the founder of ACLEDA Bank Plc. The firm emerged in the post-war period as essentially a nongovernment organisation with support from the International Labour Organization and the UN Development Programme to support micro, small and medium enterprises (MSMEs). It has since grown to be a cornerstone of the economic landscape, becoming the first financial institution listed on the Cambodian Securities Exchange as a commercial bank.

 

Channy, who said he personally uses the riel more than the dollar, said that usage of the local currency in rural areas is a “key driver” towards de-dollarisation. According to Channy, ACLEDA is planning on giving preferential rates for loans in riels because it supports the National Bank of Cambodia’s (NBC) mandate to de-dollarise.

 

read more https://www.khmertimeskh.com/50831257/riel-ing-in-loans-is-key-to-de-dollarisation-2/

[milesinnz]

For a very weak economy with a dubious banking system, I find is quite surprising that the government has managed to maintain a stable exchange rate Riel/USD . perhaps because in value terms the Riel is small beer.. but if it takes over as the main pricing mechanism, for a country that has a balance of trade deficit and a now non-existent tourist sector, how can the Riel maintain a stable value against the USD - will China provide a never ending amount of "soft" loans.. something is not adding up...

[Pique Dard]

On 3/29/2021 at 3:54 AM, geovalin said:

The use of the US dollar is a remnant of the Khmer Rouge regime,

not necessarily! there  were no khmer rouge regime in subsaharian africa, but go and see, dollar has replaced the local money there...