The Deputy Governor and Technical Director General of the National Bank of Cambodia, Dr Chea Serey, called on entrepreneurs and people, especially workers, to use the riel more widely to promote the national currency.
The call came during a meeting with a delegation from the Cambodian Young Entrepreneurs Association.
According to the National Bank of Cambodia (NBC), the use of the riel contributes to the accumulation of international reserves. For countries where the national currency is commonly used, the currency that flows into the country must be converted into the national currency before being used in domestic economic activities.
The central bank has a role to play in absorbing these currencies through the conversion of the national currency. If only the riel was used in Cambodia’s economic activity, it could significantly increase its international reserves by accumulating a surplus of foreign currency inflows into the Cambodian economy every year.
According to the NBC, the accumulation of international reserves increases national wealth, enhances monetary confidence and strengthens a solid foundation for macroeconomic stability. Appropriately high international reserves will also allow the central bank to be more likely to intervene in the foreign exchange market to reduce drastic fluctuations in the value of international currencies in order to achieve achievements that support economic growth.
In addition, the growth of international reserves will increase investments in accordance with the priority principles: 1. Security: Invest in safe financial instruments for the main purpose to maintain capital, 2. High liquidity level: Keep a high liquidity device for immediate use according to the needs of the banking system and 3. Increase revenue: Invest in financial instruments to make a profit to accumulate more international reserves.
The profits will be distributed between the central bank (for operating expenses) and the government, which can be used to invest in developing the country. Despite a reasonable amount on the size of the economy, international reserves in Cambodia could be further accumulated as the riel becomes more widely used in the country. Swift News
This article was first published in Khmer Times. All contents and images are copyright to their respective owners and sources.
