PHNOM PENH, Aug. 24 (Xinhua) -- Cambodia's reliance on imported fuel and fertilizer leaves its economy exposed to global energy disruptions, highlighting the need for vulnerable household protection alongside long-term resilience building, said a new report released on Monday.
The report, The Economic Impact of International Energy Market Disruptions on Cambodia, was co-authored by experts from the Cambodia Development Resource Institute (CDRI), the Asian Development Bank (ADB) and the Center of Policy Studies at Victoria University.
The report examined the impact of rising global fuel prices and limited fertilizer availability, both caused by disruptions to Middle Eastern supply chains.
It then shifted to policy recommendations, which include accelerating energy diversification, building green skills, and establishing strategic fuel and fertilizer reserves to reduce exposure to external shocks.
The report also called for targeted and time-bound support for vulnerable households, while preserving fiscal space for priority public spending.
"The modeling shows that if fuel prices rise further, to 50 percent higher than before the shock, economic production would fall by 1 percent," said ADB country economist Milan Thomas, who is one of the authors.
"The impact may be greater on rural households, as their agricultural production is strained by higher input costs," he added.
ADB country director for Cambodia Yasmin Siddiqi said the report provided timely analysis to support the government's ongoing response to the global fuel shock.
"Cambodia's exposure to energy market disruption is not only a short-term threat to Cambodia's recent gains in poverty reduction, but a structural development challenge," she said. "The findings provide practical, evidence-based policy options to strengthen energy security, secure critical fuel and fertilizer supply chains, and turn economic shifts into opportunities for sustainable growth."
Since the Middle East conflict erupted in late February, global market disruptions have pushed Cambodia's domestic fuel prices upward.
The Ministry of Commerce recorded a 14 percent spike in retail regular gasoline to 4,400 riels (about 1.09 U.S. dollars) on Monday, alongside a 36 percent surge in diesel to 5,250 riels. ■
