Due to the economic turmoil in Cambodia, the Asian Development Bank lowered its growth forecast to 3%. Can it be reversed in 2024?


[INNEWS Comprehensive Report] On September 20, the Asian Development Bank (ADB) announced that it had lowered Cambodia’s economic growth forecast, and the growth forecast for 2023 was reduced from 5.5% to 5.3%. Due to the global economic downturn, industrial and agricultural growth in the first half of the year was lower than expected. However, the forecast for 2024 remains at 6.0%.

Due to the global economic downturn and various uncertainties, Cambodia’s export growth faced greater pressure in the first half of the year. In particular, exports of clothing, footwear, travel supplies, etc. dropped by 18.6%. Imports of solar car parts and furniture and building materials also declined. However, Cambodia’s clothing exports bucked the trend and rose by 22.9%.

Risks to Cambodia’s economic outlook remain biased. These risks include weaker growth in developed countries, lower tourist numbers and foreign direct investment flows, tightening financial conditions, global secular issues, rising energy prices, concerns about high private debt and domestic financial stability, and severe weather caused by climate change.

Senior economist Jinho Choi expects Cambodia’s economy to grow by 5.3% in 2023, up from 5.2% in 2022. A strong recovery in tourism, coupled with strong growth in domestic consumption, will support continued economic recovery.

The Asian Development Bank said that due to the strong recovery of the service sector and the solid performance of agriculture, the bank raised its service sector growth forecast in 2023 from 7.3% to 8.0%, industrial growth forecast lowered from 5.8% to 4.8%, and agricultural growth forecast Lowered from 1.1% to 0.9%.