3 days ago
Cambodia's economy shows resilience amid global uncertainty: World Bank
PHNOM PENH: (Bernama-Xinhua) Cambodia's economy has shown resilience, largely thanks to strong exports and a partial revival in private consumption, despite heightened global uncertainty, said a World Bank report released on Wednesday (June 11), reported Xinhua.
The economic growth is projected to slow to 4 per cent in 2025 and 4.5 per cent in 2026, as the country faces global and domestic headwinds, including global uncertainty, shifts in trade policies, a prolonged downturn in the property sector, and a tightening credit cycle, the report said.
"Economic diversification is critical for Cambodia to sustain growth and job creation amid uncertainty, especially by moving beyond its reliance on construction and garment exports and promoting higher value-added manufacturing and services," said Tania Meyer, World Bank country manager for Cambodia.
"Revenue reforms can support a better business environment while generating fiscal space for critical investments in human capital and infrastructure," she added.
According to the report, Cambodia's exports, especially garments, travel goods, footwear, and bicycles, grew by 11.6 per cent year-on-year in the first quarter of the year.
Tourism services saw an increase of 16.1 per cent in international arrivals, albeit remaining below 2019 levels. Meanwhile, private consumption recovered, as evidenced by increased imports of consumption goods, including foodstuffs, garments, cars, and motorcycles.
On the external side, rising remittances and tourism revenues offset a widening trade deficit, with reserves reaching US$ 24.7 billion, the report said.
Broad money growth hit 19 per cent year-on-year, driven by favourable monetary conditions, it said, adding that inflation picked up slightly to 3.7 per cent, mainly due to food prices, while financial sector asset quality deteriorated, with higher nonperforming loan ratios. - Bernama-Xinhua
