The National Bank of Cambodia (NBC) and the National Institute of Statistics (INS) launched the Residential Property Price Index (RPPI) which compiles economic and financial statistics to analyze and evaluate economic processes, following the pre-Covid-19 real estate boom. real estate and construction sectors.
At the launch event hosted by the BNC on June 6, INS Director General Hang Lina said that the dissemination of RPPI results by the central bank’s Statistics Department was under technical assistance. of the International Monetary Fund (IMF) in collaboration with the INS.
She said the real estate and construction sector is one of the main economic sectors that has boosted the Cambodian economy, with an average gross domestic product (GDP) growth of 9% from 2000 to 2019.
The sector has also helped drive growth in related sectors, such as banking, finance, insurance, construction, wholesale, retail, and transportation.
As such, the RPPI is an important indicator of developments in the real estate and housing sector, she said.
“Timely monitoring and control will help deal with various risks, including effective countermeasures, and strengthen the Cambodian economy while avoiding any economic operations that may arise from a real estate crisis, as some countries have reported. have experienced in the past,” said Lina.
NBC Deputy Governor Chea Serey said the workshop is the fourth time the two institutions have cooperated to improve the quality and dissemination of statistics to promote the importance of policy and decision-making, and encourage stakeholders to provide data.
“The introduction of the RPPI is an achievement [for stakeholders] compiling economic and financial statistics that will allow the analysis and evaluation of economic processes, especially in real estate and construction,” she said.
The growth of the real estate and construction sectors is part of the diversification of economic activities, which could increase resilience against any economic impact and create jobs.
According to the 2019 census, the sector has helped drive economic growth, accounting for more than 2% of GDP while employing nearly 500,000 workers.
However, Serey pointed out, the residential sector has also been a source of instability and economic crisis.
Of the 50 economic crises in recent decades, more than two-thirds have been triggered by rising property prices.
Resolving a crisis will take time and require a lot of resources because the focus on this sector is associated with other important sectors, especially the financial sector, according to the IMF.
Serey noted that the real estate and construction sectors have become important pillars of economic growth, and that information and data related to the sector are even more important for economic and monetary policymakers.
“This will help monitor macroeconomic imbalances and assess risks that may arise in related sectors, particularly the financial sector,” she said.
“The introduction of the RPPI will play a crucial role in the monitoring, evaluation and formulation of development policies as well as measures to minimize risks in order to maintain macroeconomic stability.”