Cambodia's economy to grow 5.4% in 2023: World Bank

23 Nov '23

1 min read

Pic: Adobe Stock/ Siripat

Insights

Cambodia's economic growth is projected at 5.4 per cent in 2023, slightly down from the 5.5 per cent forecast earlier, as per the World Bank.
Despite a 5.2 per cent expansion in 2022, challenges like limited logistics capacity and unreliable energy supply persist.
Weakening manufacturing and exports have led to a 5 per cent drop in manufacturing jobs.

Cambodia’s economic growth is projected to reach 5.4 per cent in 2023, marginally down from 5.5 per cent forecast in May, and pick up to 5.8 per cent in 2024 and 6.1 per cent in 2025, on anticipated increases in infrastructure investment and benefits from regional trade agreements, as per the World Bank.

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 per cent in 2022, according to the World Bank’s ‘Cambodia Economic Update: Accelerating Structural Reforms’.

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.

Investment in merchandise manufacturing, including of garments, and exports of finished goods have both weakened, reflecting lower global demand. As a result, manufacturing jobs have dropped by 5 per cent, prompting authorities to provide financial support to laid-off workers.

Fibre2Fashion News Desk (NB)

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