WB Projects Cambodia’s GDP Growth at 4.8% in 2022, 5.2% in 2023

• 27 September 2022
• Local News
• 2042 Views

Cambodia’s GDP growth is projected to reach 4.8% in 2022. Traditional export-oriented growth drivers—especially the garment, footwear, travel goods, and bicycle manufacturing industries as well as agriculture—continue to underpin the economic recovery, according to the World Bank’s forecast.

In 2023, economic growth is expected to improve to 5.2%, supported by recovering domestic consumption as employment rates improve along with strong government consumption during the election year and inflation recedes, the statement said.

The travel, tourism, and hospitality industries are expected to see a boost, underpinned by a revival of domestic demand and tourism.

Over the medium term, the economy is expected to trend back to potential, growing at 6%. Poverty is expected to decline due to the projected economic recovery and moderating inflation.

The medium-term outlook is, however, subject to the global environment’s downside risks. Cambodia’s export-oriented manufacturing is vulnerable to an extended slowdown in the U.S and the structural slowdown in China.

Similarly, if elevated energy prices linger, the deterioration of the terms of trade will undermine consumer confidence, and corporate profitability and potentially prevent the economy from reaching potential growth by 2024.

Further, intensifying geopolitical tensions, growing stagflationary headwinds, rising financial instability, continuing supply-side constraints, and worsening food insecurity all present serious risks to Cambodia’s projected path to economic recovery.

• Analysis
• Economy and Finance