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VideoNovember 22, 2023

Cambodia Economic Update - From Recovery to Reform

Cambodia’s economic growth is projected to reach 5.4% in 2023, marginally down from 5.5% forecast in May, and pick up to 5.8% in 2024 and 6.1% in 2025, on anticipated increases in infrastructure investment and benefits from regional trade agreements, the World Bank said in its semi-annual outlook for the country.

This year, a combination of external pressures and structural shortcomings that are weighing on growth, despite an initial recovery in tourism and other services, according to the World Bank’s Cambodia Economic Update: Accelerating Structural Reforms. If structural reforms accompany infrastructure investments and trade opportunities, growth should continue to accelerate in the medium to long term. Cambodia’s economy expanded by 5.2% in 2022. 

Despite major investments in public infrastructure, the country’s limited transport and logistics capacity and unreliable energy supply continue to impose high costs on business and consumers. In the short term, overlapping negative shocks from the pandemic, Russia’s invasion of Ukraine, and high international interest rates are expected to continue to constrain growth.

Looking ahead, economic growth could further be affected by weakening global demand or renewed oil and food price shocks. Domestically, rising household debt and domestic credit in the real estate sector remain risks.

Last Updated: Nov 22, 2023