Cambodia’s Economic Odyssey: Anticipated 6.4% Growth in 2024

• 31 January 2024
• Local News
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The economic landscape of Cambodia is poised for robust expansion, with the National Bank of Cambodia forecasting a growth rate of approximately 6.4% in 2024. This optimistic projection, surpassing the 5.5% estimate for 2023, hinges on key sectors such as tourism, manufacturing, agriculture, and construction.

In its comprehensive report on the economic and banking sector update for 2023 and the vision for 2024, released on 29 January, the National Bank of Cambodia highlighted tourism as a pivotal driver. The sector is expected to rebound, buoyed by improved regional tourism dynamics and ongoing infrastructure enhancements.

The manufacturing industry, propelled by the implementation of the new investment law, is poised for robust growth, especially in non-garment manufacturing products. The garment sector, too, is anticipated to exhibit steady growth, according to the report.

Agriculture, benefiting from market diversification through initiatives like the Regional Comprehensive Economic Partnership (RCEP) and bilateral free trade agreements, is projected to see incremental growth. This aligns with the supportive policies of the Royal Government of Cambodia aimed at promoting production and marketing.

While the construction and real estate sectors, previously impacted by crises, are expected to experience gradual growth, driven by public infrastructure projects and a measured domestic demand recovery, particularly in the affordable housing segment. However, the demand for luxury housing targeting non-residents is anticipated to remain subdued.

Inflation for 2024 is forecasted at 2.5%, a slight increase from 2023, primarily attributed to expectations of a rise in global crude oil prices following supply cut plans by oil exporters.

Despite the promising outlook, the Cambodian economy faces risks, both external and internal. External factors include the potential lower-than-expected growth of major trading partners like China, the United States, and Europe, which could impact investment, exports, and tourism. Internally, the slow growth in the construction and real estate sectors may have ripple effects, notably on the banking sector.

• Analysis
• Economy and Finance