PHNOM PENH, April 10 – Cambodia’s agriculture sector is expected to grow modestly over the next two years, supported by rising export demand and foreign investment, according to the Asian Development Bank (ADB).

In its latest outlook, the ADB forecasts agricultural growth of 1.0 percent in 2025 and 1.1 percent in 2026. The projections are underpinned by increased foreign direct investment in 2024, along with recent bilateral free trade agreements with the People’s Republic of China and the Republic of Korea. Cambodia’s participation in the Regional Comprehensive Economic Partnership (RCEP) is also expected to support continued expansion in the sector.

The report also highlights a projected rise in inflation in 2025, following a period of very low inflation in 2024. Year-on-year inflation reached 6.0 percent as of January 2025, driven primarily by rising food prices that outpaced declines in fuel costs.

The ADB anticipates the annual inflation rate to average 3.7 percent in 2025 before easing to 2.4 percent in 2026. The National Bank of Cambodia is expected to maintain its focus on exchange rate stability as a primary tool for controlling inflation, while continuing to advance its de-dollarization efforts through the promotion of the national currency, the riel.

However, the report cautions that financial stability risks remain, particularly from rising non-performing loans and vulnerabilities in the housing construction and real estate sectors.— AKP