World Bank says Cambodia’s growth slows down due to softening property sector, border dispute, U.S. tariff hike
World Bank says Cambodia’s growth slows down due to softening property sector, border dispute, U.S. tariff hike
The World Bank said on Thursday that Cambodia’s economy is projected to grow by 4.8 percent in 2025, slowing from 6 percent in 2024 as domestic and external shocks weighed on activity.
Softening in the property sector, a border dispute with Thailand, and U.S. tariff hikes have hampered the Southeast Asian nation’s growth, according to the World Bank’s Cambodia Economic Update for December 2025.
The property market downturn has dampened domestic demand and construction activity, while border tensions have disrupted labour markets and tourism, the report said.
On Aug. 1, the United States imposed a 19-percent tariff on all goods imported from Cambodia.
“Cambodia is navigating a challenging period amid combined domestic and external shocks,” said Tania Meyer, World Bank Country Manager for Cambodia.
“Strong buffers and targeted reforms can help the country withstand these economic pressures,” she added.
Meyer said protecting vulnerable households, including returnees, remains essential.
“At the same time, improving the business environment, supporting informal enterprises and easing formalisation are critical to unlock growth, level the playing field and create better-quality jobs,” she added.
The report said Cambodia’s international reserves remain healthy, covering around 7.5 months of imports, while public debt is low at around 26 percent of Gross Domestic Product (GDP).
Inflation remains contained at an average of 2.7 percent this year, the report said, adding that foreign direct investment inflows reached $2.3 billion in the first half of 2025, up 28.4 percent year on year, helping to offset external imbalances.
- 08:19 12/12/2025
