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Government Forecasts Cambodia's Economic Growth in 2024

PHNOM PENH, May 17, 2024 — Despite high uncertainties in the global economy, Cambodia's economy is projected to grow at a rate of 6.0% in 2024. This growth is attributed to the recovery of the global economy, particularly among Cambodia's trade partners, as domestic economic activity continues to stabilize.

The momentum of 2023, which saw 5% growth, is considered high compared to other countries in the region. This robust performance has laid a solid foundation for continued economic expansion in the coming year.

According to the Royal Government of Cambodia's Strategic Budget Plan 2025-2027, this positive outlook is due to the strengthening and implementation of various policies and strategies. Notably, the acceleration of the "Pentagon Strategy - Phase 1" and priority policy programs has played a significant role. The government has continued to deepen reforms over the past few years, focusing on rehabilitating existing growth sectors and boosting new potential sectors. Investments in small and medium enterprises, as well as digital and green infrastructure, have significantly contributed to adding value to the national economy.

The "Pentagon Strategy - Phase 1" aims to enhance economic diversification, improve productivity, and promote sustainable development. It encompasses five key areas: infrastructure development, human resource development, economic modernization, social protection, and environmental sustainability. These areas are targeted to create a more resilient and competitive economy capable of withstanding global economic shocks.

One of the critical components of this strategy is the focus on small and medium enterprises (SMEs). The government has implemented various initiatives to support SMEs, including access to financing, technical assistance, and market expansion opportunities. By fostering a conducive environment for SMEs, the government aims to stimulate innovation, create jobs, and drive economic growth.

In addition to supporting SMEs, Cambodia is investing heavily in digital and green infrastructure. The government recognizes the importance of digital transformation in enhancing productivity and competitiveness. Investments in broadband connectivity, digital skills training, and e-government services are expected to accelerate the country's digital economy. Meanwhile, green infrastructure projects, such as renewable energy developments and sustainable urban planning, are set to promote environmental sustainability and reduce the country's carbon footprint.

The government’s efforts to enhance trade relations and attract foreign direct investment (FDI) are also pivotal to economic growth. Trade agreements, such as the Regional Comprehensive Economic Partnership (RCEP) and bilateral free trade agreements, are expected to open new markets for Cambodian products and services. These agreements will also attract foreign investors looking to leverage Cambodia's strategic location and favorable business environment.

The Royal Government of Cambodia has also prioritized human resource development. Education and vocational training programs are being expanded to equip the workforce with the skills needed for a modern economy. These efforts are aimed at reducing poverty, improving living standards, and ensuring that economic growth benefits all segments of society.

Furthermore, the government's commitment to social protection and healthcare is essential to sustaining economic growth. Expanding social safety nets and improving healthcare services will enhance the population's well-being, enabling greater productivity and participation in the economy.

As Cambodia continues to navigate the challenges posed by the global economic landscape, the government's comprehensive approach to policy implementation and reform is expected to yield significant dividends. The forecasted 6.0% growth rate for 2024 reflects the effectiveness of these measures and the resilience of the Cambodian economy.

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