World Bank sees Cambodia’s growth at 5.5 percent in 2025 and 2026
World Bank sees Cambodia’s growth at 5.5 percent in 2025 and 2026
The World Bank’s latest Global Economic Prospects report has forecast Cambodia’s GDP growth at 5.5 percent for this year and next year — up from an estimated 5.3 percent last year.
Released in Washington on Thursday, the annual report ranks Cambodia among the fastest-growing emerging markets and developing economies in East Asia—ahead of China, Indonesia, Malaysia, Laos, Thailand, and Myanmar.
However, Cambodia’s forecasts trail those for Mongolia (6.5 percent this year and 6.1 percent next year), Vietnam (6.6 percent and 6.1 percent), and the Philippines (6.1 percent and 6.0 percent).
China is forecast to grow 4.5 percent this year and 4.0 percent next year.
Elsewhere in East Asia, growth forecasts are for 5.1 percent in Indonesia both this year and next year, 4.5 percent and 4.3 percent in Malaysia, 3.7 percent in both years in Laos, and 2.9 percent and 2.7 percent in Thailand.
Myanmar is meanwhile expected to grow only 2.0 percent this year, with no forecast available for next year.
Regional Growth underpinned by Solid Domestic Demand
In East Asia and the Pacific (EAP), excluding China, “solid domestic demand is expected to underpin growth over the forecast horizon,” the World Bank says.
“Private consumption is set to remain firm, supported by low inflation and robust labour market conditions that will bolster household incomes.”
However, the outlook for public investment across the region is mixed.
“In all, investment growth is expected to pick up somewhat but fall short of pre-pandemic averages,” the bank says.
‘Particularly significant threat’ from Global Trade Uncertainty
Risks to the regional outlook remain tilted to the downside and centred on adverse global policy shifts and weaker-than-expected growth in China—with spillovers to other countries in the region.
Heightened uncertainty about global trade policies poses a particularly significant threat given the importance of export-oriented activity linked to global value chains in many EAP economies.
“Rising conflict and more frequent climate change-related natural disasters present further downside risks.
Prospects for U.S. growth, global inflation, and monetary policy remain uncertain and subject to both upside and downside risks.”
Seizing Untapped Opportunities for Cross-Border Cooperation
Given global policy uncertainty and trade tensions, World Bank Deputy Chief Economist M. Ayhan Kose says, “developing economies will need bold and far-reaching policies to seize untapped opportunities for cross-border cooperation.
“A good start would be to pursue strategic trade and investment partnerships with the rapidly expanding markets of other developing nations,” Kose says.
Creating a better transportation infrastructure and standardising customs processes are critical steps to cutting unnecessary expenses and fostering greater trade efficiency.
“Finally, sound macroeconomic policies at home will fortify their capacity to navigate the uncertainties of the global outlook.”
