Search

Search form

Logo of Phnom Penh Post newspaper Phnom Penh Post - Cambodia to sustain strong growth: World Bank

Cambodia to sustain strong growth: World Bank

Content image - Phnom Penh Post
A motorist passes the Minebea factory at the Phnom Penh Special Economic Zone. Hong Menea

Cambodia to sustain strong growth: World Bank

Cambodia’s economy is predicted to remain strong and resilient for the next two years, fueled by a shift to higher value-added manufacturing despite lingering concerns over political stability and the slowed growth of both the construction and garment sectors, the World Bank said yesterday in its latest review of the Cambodian economy.

The Kingdom’s robust GDP growth is expected to reach 6.9 percent in 2018 and remain almost as high at 6.7 percent in 2019, thanks to increased export diversification of footwear, electrical machinery and auto parts alongside healthy inflows of foreign direct investment, the World Bank said in its Cambodia Economic Update for October 2017.

However, downside risks—including the possibility of a slowdown in the regional economy, especially from China and “potential election-related uncertainties”—still remain.

World Bank Country Manager for Cambodia Inguna Dobraja said that while the Kingdom “appears to be on the verge of climbing up the manufacturing value chains,” this change would bring new challenges to the economy.

“To succeed in boosting export diversification, Cambodia would need to undertake deeper structural reforms that address high electricity and logistics costs, as well as skills gaps,” she said.

The report noted that in 2012, the Kingdom had 46 factories dedicated to electrical machinery and auto parts, accounting for a 5.1 percent share of the manufacturing industry. As of August of this year, the number of factories had increased to 121 and accounted for 7.1 percent of manufacturing.

“Cambodia will not be able to rely on the same factors that drove strong growth and production over the last two decades,” Dobraja said.

Updates to follow.

RECOMMENDED STORIES

  • Breaking: PM says prominent human rights NGO ‘must close’

    Prime Minister Hun Sen has instructed the Interior Ministry to investigate the Cambodian Center for Human Rights (CCHR) and potentially close it “because they follow foreigners”, appearing to link the rights group to the opposition Cambodia National Rescue Party's purported “revolution”. The CNRP - the

  • Rainsy and Sokha ‘would already be dead’: PM

    Prime Minister Hun Sen on Sunday appeared to suggest he would have assassinated opposition leaders Sam Rainsy and Kem Sokha had he known they were promising to “organise a new government” in the aftermath of the disputed 2013 national elections. In a clip from his speech

  • Massive ceremony at Angkor Wat will show ‘Cambodia not in anarchy’: PM

    Government officials, thousands of monks and Prime Minister Hun Sen himself will hold a massive prayer ceremony at Angkor Wat in early December to highlight the Kingdom’s continuing “peace, independence and political stability”, a spectacle observers said was designed to disguise the deterioration of

  • PM tells workers CNRP is to blame for any sanctions

    In a speech to workers yesterday, Prime Minister Hun Sen pinned the blame for any damage inflicted on Cambodia’s garment industry by potential economic sanctions squarely on the opposition party. “You must remember clearly that if the purchase orders are reduced, it is all