Cambodia Table of Contents
The creation of the People's National Bank of Kampuchea in 1980 reestablished Cambodia's banking system, which Pol Pot had abolished immediately after the fall of Phnom Penh in 1975. The bank's chairman held ministerial rank in the government (see Government Structure , ch. 4). By 1984 more than thirty branch banks were in operation. The main functions of the bank were to provide funds for state commerce and credits for agriculture.
The Heng Samrin government reintroduced the country's currency, the riel, in March 1980, at which time the value of one riel equaled the value of one kilogram of rice. The state controlled all foreign exchange, and the official exchange rate for visitors was 4 riels to US$1 in 1980. After five years of relative stability, the government devalued the currency to 30 riels per US$1 in January 1986. A subsequent devaluation, reducing the rate to 100 riels per US$1, took place in October 1987. The move was intended to curb inflation, to stop the growing black market, and to bring in more foreign currency. The free-market rate in Phnom Penh at the time was 125 to 130 riels per US$1. In December 1987, the People's National Bank of Kampuchea issued new five- and ten-riel notes in blue and green and invalidated the country's old red bank notes, in an effort to eliminate the problem of counterfeit currency.
Data as of December 1987