Revise GDP calculation: PM

AFP
Prime Minister Hun Sen called for GDP growth figures to include the rural microeconomy.

The Phnom Penh Post

Written by Kay Kimsong
Monday, 09 March 2009

Prime Minister Hun Sen called on GDP growth statistics to include the rural microeconomy, a measure he said would make information more accurate

PRIME Minister Hun Sen wants national economic growth to include the domestic output of women in individual families and small-scale agriculture, criticising recent estimates for therefore being incorrect in omitting such information.

The premier requested that the National Institute of Statistics consider incorporating "home-garden yield" into national growth estimates.

"We haven't calculated GDP per capita correctly. ... If a family has grown two papaya trees and two banana trees and plants four or five eggplants for a daily living, this is a type of growth," Hun Sen announced Friday in a speech ahead of the 99th Anniversary of the International Women's Day.

The premier said Cambodia's gross domestic product would be much higher if the small or micro-scale economies of individual families were included, and said that such economies have prevented Cambodia from being exposed to the full brunt of the global financial crisis.

Yang Saing Koma, president of the Cambodian Centre for Studies and Agricultural Development (CEDAC), agreed that home-garden yield does contribute to the national economy by creating jobs while reducing the cost of family income in rural areas. He urged the government to take measures to help villagers plant more crops, fruit trees, vegetables and plants for individual family food security.

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If a family has grown two papaya trees ... this is a type of growth.
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"It is hard to know how much the microeconomy has shared in the scale of national economic growth, but it is quite a lot," he said.

"Sources of income for villagers are very small. If villagers are able to grow their own vegetables at home, their expenditures will be reduced," he added.

Yang Saing Koma also called for the government to provide financial and technical assistance to slow the importation of fruits and vegetables in order to protect national output.

"If the government is able to limit the amount of imported agricultural goods from neighbouring countries, Cambodian farmers will be able to meet growing domestic demand," he said.

Chan Sophal, president of the Cambodia Economic Association, said he welcomed the idea of encouraging individual families to grow their own products, but including it in GDP would not alter the standard of living.

"If we counted home-garden yield in the official economy, we will see GDP increase, but living conditions will not change," he said.

He added that micro-scale economies did not generate much revenue in rural-level economies, and if it were included in national GDP growth, the number would likely remain unchanged.

"This year a family raises five chickens and next year they keep raising five chickens, it is not growth," said Chan Sophal.

Hun Sen's comments were made the same day that the International Monetary Fund forecast that Cambodia's GDP this year would contract half a percent.