Cambodia’s national budget determines state expenditures and revenues. It is the most important policy tool for the government to address the needs of people. Under the guidance of the prime minister, the Ministry of Economy and Finance (MEF) is responsible for budget preparation around the government’s plans and strategies, such as the National Strategic Development Plan (NSDP), in the pursuit of economic growth, social development and poverty reduction.
By law, parliament does not have any responsibility in budget planning but it plays a vital role in the discussion and approval of the draft budget law. According to the 1993 Law on Financial System, the government needs to submit the draft budget to the National Assembly and Senate for discussion and approval. The National Assembly checks, analyzes and debates the proposed budget before adopting it. The adopted budget law is then sent to the Senate. Finally, the King promulgates it into law.1
Preparation of the draft budget law involves the following processes2:
- Stage 1: Strategic planning for budget (March–May)
- Stage 2: Preparation of budget packages (June–September)
- Stage 3: Approval of budget (October–December)
In October 2019, Cambodian cabinet ministers approved a draft budget for 2020 of US$7.58 billion.3 The planned budget represents approximately 26 percent of GDP.
The budget deficit (where expenditure is higher than income) has declined significantly in recent years as a result of a strong move to effective tax collection. The overall budget deficit in 2018 was estimated to be around 1 percent of GDP. Government revenues grew at 16.4 percent in 2018 while total expenditure grew by 13.7 percent.9
In its survey in 2015, International Budget Partnership ranked Cambodia’s budget transparency nearly at the bottom of the 102 countries examined. Civil society and public involvement in the budget process is limited. The International Budget Partnership’s survey found that Cambodia’s budget transparency was low, scoring 15 out of a possible 100 points in 2013.10
In its 2017 survey Cambodia scored 20 out of 100 – still a comparatively low score, but an improvement over earlier years. In terms of allowing public participation, Cambodia scores lower than Vietnam or Thailand, but above Myanmar. It found that the legislature provides only limited oversight, but it found that the supreme audit institution provides adequate oversight – better than the limited oversight it found in 2015.11
Related to budget
Last updated: 30 October 2019
- 1. Economic Institute of Cambodia (EIC). “The Role of Parliament in Budgetary Oversight.” Accessed 10 November 2014, http://www.pic.org.kh/fileadmin/user_upload/Files/Library_Resources/The_role_of_parliament_in_budgetary_oversight_Eng.pdf
- 2. Ministry of Economy and Finance (MEF). “Presentation on Formulation Processes of Draft Budget Law in 2015″. Accessed on 1 December 2014. http://mef.gov.kh/documents/mustsee/NA-Presentation_20-Nov-2014.pdf
- 3. Ministry of Information, 25 October 2019. “Cabinet Meeting Approves Nearly $8 Billion National Budget for 2020.” https://www.information.gov.kh/detail/351964 Accessed 28 October 2019.
- 4. Kong Meta 2018. “PM approves 2019 budget”. The Phnom Penh Post, 29 October 2018. https://www.phnompenhpost.com/national/pm-approves-2019-budget Accessed 28 October 2019.
- 5. Mech Dara 2017. “National Assembly passes $6 billion 2018 budget”, The Phnom Penh Post, 20 November 2017. http://www.phnompenhpost.com/national/national-assembly-passes-6-billion-2018-budget Accessed 25 November 2017.
- 6. Ibid
- 7. Siv Meng. “Minister of Economy and Finance talks 2016 budget.” The Phnom Penh Post, 4 December 2015. Accessed 26 December 2015, http://www.phnompenhpost.com/business/minister-economy-and-finance-talks-2016-budget
- 8. Khan Sophirom. “Cambodian Lawmakers Approve the Draft Budget Law for 2015″. Agence Kampuchea Presse (AKP), 29 November 2014. Accessed 22 April 2015, http://www.akp.gov.kh/?p=54554
- 9. National Bank of Cambodia 2018. Financial Stability Review 2018. https://www.nbc.org.kh/english/publications/annual_reports.php Accessed 30 May 2019
- 10. NGO Forum on Cambodia. “Budget transparency remains low in Cambodia”. Last updated 4 June 2013. Accessed 1 December 2014, http://www.ngoforum.org.kh/index.php/hot-news/events/8-budget-transparency-remains-low-in-cambodia
- 11. International Budget Partnership 2017. Open Budget Survey 2017. https://www.internationalbudget.org/wp-content/uploads/cambodia-open-budget-survey-2017-summary.pdf Accessed 30 May 2019.