PHNOM PENH, Sept 5 (Bernama-Xinhua) -- Cambodia's economy is expected to grow by 5.6 per cent in 2024, up from 5 per cent in 2023, according to a press release by the ASEAN+3 Macroeconomic Research Office (AMRO) on Thursday.
The growth will be driven by an increase in garment exports and a continued recovery in the tourism sector, reported Xinhua.
"A rebound in the garment sector due to stronger demand in major advanced markets, and a robust tourism recovery will fuel Cambodia's economic growth in 2024 and 2025," the press release said, adding that the growth for 2025 is forecast at 5.9 per cent.
"The non-garment manufacturing sector is expected to sustain its strong growth momentum, supported by stable foreign direct investment (FDI) inflows," it added.
The Southeast Asian country's growth traditionally relies on garment export, tourism, agriculture, as well as construction and real estate.
Cambodia's path toward a strong economic recovery is confronted with external short-term risks and domestic vulnerabilities such as declining asset quality in the banking sector and a potential weakening of the real estate sector, the press release said.
"Rebuilding policy space, mitigating financial stability risks and strengthening the supervision of the real estate sector are key to post-pandemic growth," it said.
AMRO Chief Economist Hoe Ee Khor said Cambodia is among the countries with the fastest growth in the region.
"Growth in the garment sector is projected to rebound steadily in 2024, driven by stronger demand for consumer goods in major advanced markets. Likewise, the non-garment sector is forecast to sustain its strong growth momentum, supported by stable foreign direct investment inflows," he told Xinhua in a recent e-mail.
"A robust tourism recovery, fuelled by increased flight availability and the gradual return of foreign tourists, coupled with pent-up domestic consumption, will further bolster the ongoing improvement in the service sectors," he said.
According to the press release, consumer price index inflation in Cambodia is expected to rise to 2.2 per cent in 2024 and 2.3 per cent in 2025 from 2.1 per cent in 2023, due to higher domestic demand and a possible rebound in energy prices.
--BERNAMA-XINHUA
