Last updated: October 2015

Cambodia continues to enjoy robust growth, albeit at a slightly slower pace. Real growth in 2014 is estimated to have reached 7.1 percent. The garment sector, together with construction and services, continues to propel growth. However, the 2015 and 2016 projection for economic growth is about 6.9% as it confronts stronger competition in garment exports, continued weak agriculture sector growth, and softer growth in the tourism sector.

Poverty continues to fall in Cambodia, although the pace has declined significantly. The poverty rate was 17.7 percent in 2012, with almost 3 million poor people and over 8.1 million who are near-poor. About 90 percent of them live in the countryside. World Bank estimates suggest that Cambodia achieved the Millennium Development Goal (MDG) of halving poverty in 2009. However, the vast majority of families who escaped poverty were only able to do so by a small margin, thus the significant share of the near-poor.

Human development, particularly in the areas of health and education, remains an important development priority for Cambodia. 32 percent (or approximately 0.5 million) of children under five-years-old are stunted; 82 percent (12.2 million people) of Cambodia’s people do not have access to piped water supply and 63 percent (9.3 million people) do not have access to improved  sanitation (2014).

Cambodia has made good strides in improving maternal health, early child care, and primary education programs in rural areas. The maternal mortality ratio per 100,000 live births decreased from 472 in 2005 to 170 in 2014, the under-five mortality rate decreased from 83 per 1,000 live births in 2005 to 35 per 1,000 in 2014, and the net primary school admission rate increased from 81 percent in 2001 to 95.3 percent in 2014.

Cambodia has also been successful in combating HIV/AIDS, tuberculosis and malaria. HIV prevalence among adults aged 15-49 decreased from 0.9 percent in 2006 to 0.7 percent in 2012. In 2014, 89 percent of active AIDS patients in Cambodia had access to antiretroviral treatment, a rate of coverage that is among the highest in the developing world. Tuberculosis prevalence rate per 100,000 population decreased from 1,230 cases in 2005 to 715 cases in 2013, and tuberculosis case fatality rates declined from 157 to 66 per 100,000 population at the same period. Malaria incidence decreased from 71,814 cases in 2009 to 24,135 cases in 2013, and malaria case fatality rates also decreased dramatically from 219 to 12 in the same period. Cambodia is on its way to achieving its goal of malaria elimination by 2015.

Cambodia still faces a number of development challenges, including weak public service delivery which impede inclusive development, ineffective management of land and natural resources, environmental sustainability, and good governance. The key challenge going forward is to stimulate the agricultural and tourism sectors to once again become strong engines of growth supporting poverty reduction, as well as to expand and sustain growth and promote diversification in the manufacturing sector.

Last updated: October 2015

Cambodia received its first credit from the World Bank in 1993. Following decades of conflict in the country, the World Bank’s priority areas were to support the reconstruction of social and economic institutions and the development of physical infrastructure. Since 1999, increasing focus has been placed on governance reforms, macroeconomic stability and sustainable economic growth, private sector development, rural development, sustainable natural resource management, and improving and expanding health and education services.

The World Bank Country Assistance Strategy (2005-2008, extended to 2011) outlined two priority areas: removing governance constraints on growth and poverty reduction and supporting the strategies and investments needed to achieve Cambodia’s development goals. Projects financed by the World Bank under this strategy have been designed to help implement Cambodia’s National Strategic Development Plan for 2006-2011 (extended to 2013) and to help Cambodia achieve the MDGs.

The World Bank Group has provided analytical and policy advisory services to help Cambodia address pressing development priorities – including assessments of poverty and the investment climate, and studies on trade development, water and sanitation, health care, teacher quality improvement, and social protection.  The World Bank works closely together with Cambodia’s development partners as well as the Government, through joint government-donors Technical Working Groups, such as on Planning and Poverty Reduction, Private Sector Development, Public Administrative Reform, and Public Financial Management.

In June and July, 2015, the World Bank Group carried out extensive country consultations with a wide range of stakeholders on Cambodia’s development opportunities and pressing challenges, and ways to address them in the next two to three years to help implement the government’s national development strategy. These consultations will help frame WBG’s future engagement in Cambodia. 

Last updated: October 2015

Education: Under the Bank-administered Cambodia-Education for All Fast Track Initiative, more than 27,000 lower secondary school students received scholarships to complete all levels of basic education, more than 6,300 primary school teachers were
trained to become basic education teachers, 1,270 classrooms have been constructed, and 900 early childhood education programs have been established to reach 26,042 children. In addition, under the new Second Education Sector Support Project, funded by Global Partnership for Education, more than 68,000 primary school students and more than 58,000 secondary school students from poor households will receive scholarships, 100 school buildings and 20 district education office buildings will be constructed, 500 communities will receive pre-school shelters, and 2,000 teachers will be trained to improve teaching quality. Under the ongoing Higher Education Quality and Capacity Improvement Project, more than 900 poor and disadvantage students have received Special Priority Scholarships for their university degree.

Health: The Second Health Sector Support Program (HSSP2), co-funded by the International Development Association (IDA) and a multi-donor Trust Fund administered by the Bank, is improving the coverage and quality of health care services by expanding the health facility network, supplying medical equipment, financing technical and institutional capacity improvement, financing health outreach activities in remote and difficult to access areas, and co-financing the Health Equity Fund and Service Delivery Grant. The Health Equity Fund is helping the poor to access health care services and has paid for 1,549,222 cases in 2014. The Service Delivery Grant is leveraging the improvement of health facility management, staff attendance, and the coverage of health services. Under the HSSP2, a provincial hospital, the National Laboratory for Drug Quality Control, two regional medical training centers, 121 health centers and five health posts, and 79 additional delivery rooms have been constructed. HSSP2 is also supporting improved water quality, electricity and sanitation in 61 health centers, and the establishment of 12 non-communicable disease clinics.

Land and Agriculture: The Government’s land reform agenda includes allocation of social land concessions. The Bank-funded Land Allocation for Social and Economic Development (LASED) project has provided land and livelihood support to more than 4,700 landless or land-poor families. 260 families have received land titles with the remaining beneficiaries receiving titles after the five-year cultivation period. Agriculture based livelihoods and sustainability will be at the center of
continued support for the Government’s land reform agenda.

Water Supply and Sanitation: Under the Water and Sanitation Program (WSP) Technical Assistance program, 27,000
families have gained access to improved sanitation through local markets and 44,900 families have gained access to piped water supply provided by private water suppliers. Recently, the Rural Water Supply, Sanitation and Hygiene National Action Plan is being finalized and will be used as a roadmap for the sector to improve harmonized approaches to achieve the 2018 National Strategic Plan. In addition, decentralized rural sanitation will help bring the service delivery closer to the communities and is being piloted in ten districts in two provinces. 

Transport: The Road Asset Management Project has helped rehabilitate some 450 kilometers of Cambodia’s national and provincial road networks. It has also helped improve the efficiency and governance of the transport sector by strengthening capacity within the Ministry of Public Works and Transport for road asset management planning, including budgeting and
routine and periodic maintenance.

Trade:  The Bank-managed Trade Related Assistance to Cambodia (TRAC) program, co-funded by the EU, DANIDA and UNIDO, is assisting the Government in designing and formulating a trade policy to increase Cambodia’s integration into regional and global markets. The program helps to simplify import and export procedures, and border processes via an Automated System Customs Data—World System (ASYCUDA) at Customs Offices. Between 2010 and 2014, customs clearance fell from 5.9 days to 1.4 days. As a result, Cambodia saw its ranking increase by 46 places, from 129th to 83rd out of 160 countries, in the Logistics Performance Indicator (LPI). Through this support, the Ministry of Commerce has streamlined procedures on new company registration, automated Certificate of Origins and drafted e-commerce laws. This law, once approved, will help private applicants to simply go online, register a new company, and apply for relevant export permits. By reducing direct interaction with government officials, these platforms are expected to save cost of doing business, and improve transparency and accountability.

By supporting the Cambodian Chamber of Commerce (CCC) and facilitating direct consultations with decision makers, TRAC
has also assisted the government in including the voice of the private sector in the process of policy formulation. A large number of analytic products —namely the Enterprise Survey, the Investment Climate Assessment (ICA), and the Doing
Business Report— have been applied to collect and analyze the perceptions of the private sectors and inform policy implementation.

Finally, the TRAC program has allowed the government to further develop human and institutional capacities, via establishing the Trade Training Research Institute (TTRI), strengthening the capacity of the Institute of Standards of Cambodia (ISC), and improving Cambodia’s Border Control Agency (CAMCONTROL) risk management.  

Governance: Under the Demand for Good Governance Project, 36 “One Window Service Offices” have been established at the district level to provide public services closer to citizens and businesses. These offices have provided services, such as motorcycle registration, small business licenses and construction permits, servicing nearly half a million cases over the last five years. Grants that were provided to 35 different NGOs helped 330 schools, 220 commune councils and 150 health centers improve staff performance and local services. The independent Arbitration Council, established under the project in 2009, resolved over 1000 disputes involving more than 700,000, mostly female workers from the garment industry. The quality of the Council’s decisions has been commended by international experts, and an independent survey indicates that both employers and unions value the Council’s integrity (no informal payments are made),independence and effectiveness.

Public Financial Management: The Public Finance Management Modernization Program (PFMMP) supports the government’s reforms to improve its ability to raise revenue and to strengthen the public finance management system. Key
achievements include the elimination of payment arrears, the establishment of a treasury single account, and the use of the banking system for government transactions.

The International Finance Corporation (IFC) supports the private sector in Cambodia through investment and advisory services. It works with the government to develop a competitive private sector and promote inclusive and sustainable economic growth. Since 2000, IFC has committed $312 million of investment in Cambodia with a focus on financial and infrastructure services. In the rice sector, IFC helps improve the competitiveness of the Cambodian rice export sector on key processes along the value chain, covering farming, milling and exporting practices. Through this project, farmers can get higher-value seed and training on planting techniques. By June 2015, IFC trained more than 34,300 farmers in eight provinces on farming techniques and approximately 14,500 farmers on improving fragrant rice seeds. As a result, their average rice yields has increased by 20 percent, with additional earning of $3.5 million.

IFC assists about 100 medium and large scale rice millers and exporters in eight provinces in the areas of upgrading production facilities, efficient mill management and complying with food safety, occupational health and safety standards. By June 2015, 10 rice mills have received HACCP (Hazard Analysis Critical Control Point) certified by the international certification
bodies, and two more will receive certification by December 2015. 92% of rice mills reported improved access to international markets and 83% reported improved performance and productivity.

IFC also works with many Cambodia’s rice exporters to increase the value of exports through development of new strategies targeting niche markets willing to purchase fragrant rice at premium prices. Initial results are clearly encouraging, with national rice exports doubling from more than 205 thousand ton in 2012 to nearly 390 thousand ton in 2014. Notably, Cambodian rice has won the world’s best rice awards at the World Rice Conferences in three consecutive years—2012, 2013 and 2014. With IFC’s support, the project has directly facilitated $100 million of rice export by June 2015.

Credit Bureau: IFC supported the establishment of a private credit bureau, which has facilitated an estimated $2.96 billion in financing since its launch in March 2012. As of June 2015, 98 financial and microfinance institutions have subscribed to the bureau which records credit information on 4.6 million borrowers and received a total number of 8 million enquiries.

Secure Transactions: IFC helps the government improve the country’s legal and regulatory framework as well as the lending practices of financial institutions. Working with the Cambodian government and banks, IFC introduced movable-asset
financing allowing borrowers to use goods, inventory and equipment as collateral for loans. This initiative will help Small and Medium Enterprises, especially those in agricultural sector, to obtain bank loans more easily.

Investment Policies: IFC, together with the World Bank, is helping the government to improve the quality and transparency of its investment policy with the view to encourage more private investment in the country. Currently, the project has
completed an Inventory of Investment Incentives and Investor Motivation Survey, a critical input for the upcoming new Investment Law.



Cambodia: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments