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IMF revises Cambodia's growth forecast to 5.6%

26 Oct '23

1 min read

Pic: Adobe Stock

Insights

Cambodia's real GDP is projected to decline to 5.6 per cent this year, as per the IMF.
However, this is considered strong growth, and it is expected to rebound to 6.1 per cent in 2024.
The reason for the slight revision is weaker external demand, particularly from US and Europe to which Cambodia is highly exposed.
China's influence also plays a role.

Projecting a marginal decline in Cambodia’s real gross domestic product (GDP) to 5.6 per cent this year, the International Monetary Fund (IMF) recently termed its economic growth ‘strong’. It is expected to grow by 6.1 per cent in 2024.

“On Cambodia, we have 5.6 per cent growth this year and 6.1 next year, 2024, it's only 0.2 and 0.1 less than what we had before. And like the Association of Southeast Asian Nations (ASEAN) theme, it's really revised down only because of weaker external demand. So, we do expect things to improve. And Cambodia is very exposed to the US and European market and demand there is weaker also,” Shanaka (Jay) Peiris, division chief of regional studies, Asia and Pacific Department, said during a press briefing on Regional Economic Outlook for Asia and Pacific in Singapore recently.

China exposure is also significant, and plays a role in the slightly weaker growth, which is still solid. RCEP does provide a diversification, he said.

“We've seen integration in Cambodia with ASEAN trading partners increase rather than decreasing some of the exposure to US, Europe, which is very high. So, in that sense, it's helping the Cambodian economy diversify,” Peiris added.

Fibre2Fashion News Desk (DS)

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