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

  • Ministry issues warning over coronavirus outbreak

    The Ministry of Health on Wednesday asked the public to be on “high alert” as a new virus wreaks havoc across Asia. However, no cases have been reported in the Kingdom thus far. The 2019 Novel Coronavirus (2019-nCoV) has raised the alarm for its similarity to

  • Call for boycott of Angkor unacceptable

    Dear Editor, I wish to express my strong disagreement on the article published by Traveller for their website with the title Best places to go in 2020: 12 destinations you should avoid. Below is my opinion of the article. It is obviously free for the Traveller to

  • No power shortages next dry season, says energy minister

    Minister of Mines and Energy Suy Sem has assured the public that Cambodia will not suffer power shortages during the next dry season. Speaking on local TV on Tuesday, Sem projected a rise in power demand during 2020’s dry season – which starts in November and

  • Gov’t slams NGO over 2019 corruption report

    The government on Thursday slammed a report that described the Kingdom as highly corrupt. Government spokesperson Phay Siphan dismissed the latest Transparency International (TI) report as “just an advertisement of NGOs to promote their own interests”. Released on Thursday, the report puts Cambodia near the

  • Gov’t takes steps to lower logistics, transport costs

    With the threat of losing trade privileges in the EU drawing closer, the government is taking measures to reduce logistics and transportation costs to safeguard the Kingdom’s competitiveness. The EU is due to decide whether or not to withdraw the Kingdom’s trade privileges

  • App to connect farmers to millions

    The Ministry of Agriculture, Forestry and Fisheries has soft-launched a mobile app that connects farmers with potential buyers and gives them access to critical market information. The ministry’s Agriculture Marketing Office chief Meach Yady said the ‘CamAgriMarket’ app gives farmers a platform to showcase