Phnom Penh: The World Bank says Cambodia’s economy is gradually recovering and is projected to grow 4% over the remainder of 2021, but will be “uneven and volatile”, in part due to the 20 February Community Transmission Event and its subsequent lockdowns. The statement is contained in the World Bank’s “Road to Recovery” report, its latest edition of its biannual economic update for the country.
The bank says some sectors have seen economic gains over the past six months, but others are battling. It has found that agriculture has been relatively resilient, thanks to strong demand stemming from the newly-signed Cambodia-China Free Trade Agreement. The manufacturing sector has gradually recovered, adapting to evolving external conditions and wholesale and retail businesses have also been experiencing a slow but steady recovery.
Worst hit, thanks to the closure of borders and the impact on the tourism industry, parts of the services sector, such as accommodation, restaurants and transport, continue to be hard hit, although the World Bank says inflows of Foreign Direct Investment remain resilient and are helping to sustain the Cambodian economy as a whole.
Cambodia’s World Bank country manager, Inguna Dobraja, says, “Like many countries in the region, Cambodia has been hit hard by the global demand shock brought on by Covid-19. But the good news is that Cambodia has now vaccinated more than 3 million people, one of the highest rates in the region. The World Bank is working with Cambodia to provide further support to combat the pandemic and help the country’s resilient economic and social recovery.”
The report includes a special section looking at lessons learned from Cambodia’s “relatively swift introduction, expansion and deepening of social assistance programs - in particular its cash transfer program. The cash transfer scheme was introduced in June 2020 and by February 2021, more than 688,000 poor families had received a cash transfer from the government - representing 19.5 percent of all households”.