Kingdom’s growth forecast raised to 4.8% this year

The World Bank has raised its growth forecast for Cambodia to 4.8% this year, up from its April projection of 4.5%, despite worsening global demand and rising commodity prices.

Traditional export-oriented growth drivers, especially the garment, footwear, travel goods and bicycle manufacturing industries as well as agriculture, continued to underpin Cambodia’s economic recovery, said the World Bank East Asia and Pacific Economic Update released yesterday.

In the second quarter of 2022, the economic recovery gained momentum as investment and trade expanded, the report said, adding that approved foreign direct investment (FDI) project value reached US$315mil (RM1.45bil) in the second quarter of 2022.

“Merchandise (excluding gold) exports accelerated further, expanding at 33% year-on-year during the first seven months of 2022, driven mainly by a recovery of garment, travel goods and footwear exports,” the report said.

“The services sector, especially the travel and tourism sector, also improved.”

Aaditya Mattoo, chief economist for the World Bank’s East Asia and Pacific, said Cambodia’s successful control of the Covid-19 pandemic has revised domestic economic activities and increased merchandise exports.

“Cambodia has adopted a very successful strategy for a long time to deal with the Covid-19 shock and the economy has gradually recovered,” he said at a press conference via video link.

According to the World Bank’s report, the country’s inflation is forecast to rise to six per cent this year before easing to 4.2% next year. — Xinhua