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.

MOST VIEWED

  • Reuters: US Embassy fired 32 staff members for sharing pornography

    The United States Embassy in Phnom Penh has fired 32 non-diplomatic staff members who were allegedly caught exchanging pornographic images and video, including of minors, according to the news agency Reuters. Four sources, who spoke on condition of anonymity, told Reuters the content was shared in

  • Our 2018 guide to spending Khmer New Year in Phnom Penh

    Khmer New Year festivities are upon us. For the next few days, travellers will be making their way to their home provinces to eat, celebrate, play traditional games and visit a pagoda with offerings. If you will be staying put in Phnom Penh for the

  • US think tank warns of China's 'ulterior motives'

    A US think tank on Tuesday warned that spreading Chinese investment in the Indo-Pacific follows a pattern of leveraging geopolitical influence at the expense of the nations receiving investment, including Cambodia. The report looks at a sample of 15 Chinese port development projects, noting that the

  • More than three tonnes of ivory reportedly bound for Cambodia seized in Mozambique

    A total of 3.5 tonnes of ivory reportedly bound for Cambodia was seized by authorities in Mozambique late last week, according to the NGO Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES). CITES' information was based on a report from the