ECONOMIC AND FINANCIAL

ENVIRONMENT

CAMBODIA
by Kent Leo Batuigas
 17,223,209 KHMER
Population Official Language

PEOPLE KHMER 90% 10,982,812 PERSONS

BETWEEN 15 AND 64

YEARS OLD
Ethnic
Age structure
Groups
GDP
GROWTH

Source: Asian Development Bank. Asian Development Outlook (ADO) 2022 (April 2022)
INFLATION

Source: Asian Development Bank. Asian Development Outlook (ADO) 2022 (April 2022)
GDP
PER
CAPITA
Source: Asian Development Bank. Asian Development Outlook (ADO) 2022 (April 2022)
 CAMBODIA'S ECONOMIC GROWTH
Cambodia's economy will grow by 4.5

percent in 2022 but the road ahead

remains unclear. The fiscal deficit is

expected to widen to 6.3 percent of

GDP, as the government will need to

continue spending programs to support

the poor.

Source: World Bank

GDP

GROWTH

BY

SECTOR
The gross domestic product

(GDP) measures of national

income and output for a

given country's economy. The

gross domestic product

(GDP) is equal to the total

expenditures for all final

goods and services produced

within the country in a

stipulated period of time.

Source: Trading Economics

 AGRICULTURE AND FOOD SECURITY
Nearly 61 percent of Cambodians live in rural areas, and 77 percent of

rural households rely on agriculture, fisheries, and forestry for their

livelihoods. Cambodian farmers are extremely vulnerable to climate

change-induced increases in temperatures, changes in rainfall patterns,

and extreme weather events. According to the United Nations Food and

Agriculture Organization, 45 percent of Cambodians live in moderate or

severe food insecurity. In response, USAID strives to broaden inclusive

and sustainable economic growth through partnerships with the private

sector that modernize the agriculture sector, increase incomes, and

improve nutritional outcomes.

Source: USAID
 INDUSTRY
Cambodia has seen solid growth since 1998, with GDP growth averaging at about

8% each year. This economic growth is expected to trend upwards, with a growth

of 7.0% projected for 2019 and 6.8% for 2020, according to the Asian Development

Bank. (These were made before the COVID-19 impacts early in 2020). This strong

performance is largely being driven by the continual expansion of the Kingdom’s

key industries. One of Cambodia’s key industries, the export of garments and

footwear, were valued at $10 billion in 2018, up 24 per cent from $8 billion in 2017

according to NBC’s (National Bank of Cambodia) 2018 report. Other key industries

such as light manufacturing, tourism and agriculture and construction have also

experienced positive growth. The impact of the global COVID-19 pandemic

affected Cambodia too and the World Bank projected the Kingdom’s economy to

contract by 2 per cent in 2020 but is expected to grow by 4 per cent in 2021.

Source: B2B Cambodia

 SERVICES
As a result of a determined regulatory reform process and an economic modernization process over the

past two decades, Cambodia has experienced extraordinary economic growth. In 2004, Cambodia became

the first low-income country to join the World Trade Organization (WTO). Since then, Cambodia has grown

to become one of East Asia s most open economies, especially in the services sector. Cambodia s

impressive economic growth owes much of its driving force to the boom in services trade. Services exports

grew more than 20 percent a year for most of the past decade led by a rapid expansion in tourism. Foreign

direct investment (FDI) particularly in tourism, construction, infrastructure, agro-processing, and

telecommunications also supported the expansion of services trade, not only by attracting foreign capital

and expanding employment into Cambodia, but also by improving domestic technology and enhancing

domestic skills. Cambodia is quickly becoming a sophisticated economy that needs to move beyond the

pillars of textiles and tourism exports by diversifying into the export of modern services. Cambodian firms

are already tentatively exporting some niche services such as computer-based animation. Modern services

exports to other East Asian countries, including information technology (IT)-related services, are likely to

play a more important role in Cambodia as a source of employment, revenue, and investment. In the

regional context, Cambodia stands to benefit from its chairmanship of the Association of Southeast Asian

Nations (ASEAN), by showcasing its economic reform and modernization process, and increasing the

potential to attract investments from services firms interested in serving the region as whole. Cambodia

should act quickly to address potential competition from other least-developed (LDC) and developing

countries across the regions that are also expanding their services industries

Source: World Bank Group Open Knowledge