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Currency Sovereignty in Transition: Cash Circulation Governance at the Central Bank in Cambodia and Lessons from Four Central Banking Systems

Author

Listed:
  • Ean Lay, Sam
  • Phon, Sophat
  • Som, Vuddneath
  • Lum, Sothearak

Abstract

This study assesses whether the central Bank in Cambodia’s (NBC) cash circulation system can support its goals of expanding riel use and sustaining trust as Bakong scales. While functional, the system faces gaps in rural access, data, analytics, and public education. Comparative evidence suggests current infrastructure is insufficient for de‑dollarization at the pace NBC projects. Theoretically, the review shows that currency substitution depends on governance capacity, not macroeconomic conditions alone; extends lifecycle models to integrate digital and physical currency governance; and provides a case of CBDC deployment preceding mature cash systems. Practically, comparator cases highlight lessons in data use (U.S.), resilience (Sweden), rural access (Brazil), and counterfeit defence (South Africa). Scenario analysis indicates riel circulation could reach mid‑thirties by 2034 under current policy, or half under sustained reform. Cambodia’s position—building infrastructure deliberately rather than inheriting legacy systems—offers a unique advantage for monetary sovereignty.

Suggested Citation

  • Ean Lay, Sam & Phon, Sophat & Som, Vuddneath & Lum, Sothearak, 2026. "Currency Sovereignty in Transition: Cash Circulation Governance at the Central Bank in Cambodia and Lessons from Four Central Banking Systems," MPRA Paper 130364, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:130364
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    References listed on IDEAS

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    JEL classification:

    • B30 - Schools of Economic Thought and Methodology - - History of Economic Thought: Individuals - - - General
    • B4 - Schools of Economic Thought and Methodology - - Economic Methodology
    • B40 - Schools of Economic Thought and Methodology - - Economic Methodology - - - General
    • B5 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches
    • G1 - Financial Economics - - General Financial Markets
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • K0 - Law and Economics - - General
    • K00 - Law and Economics - - General - - - General (including Data Sources and Description)

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