Of $380 billion in international development financing committed to South-East Asia, only 7 percent or $27.1 billion, has been earmarked for Cambodia, as per the Lowy Institute Southeast Asia Aid Map.
There is also a gap between what international partners promise and deliver. With international partners committing as much as $27.1 billion for 14,986 projects in Cambodia – but having spent only $17.7 billion in the country. About 14,986 projects in the country are in various stages of development.
Also, total official development finance to Cambodia fell by 30 percent in 2022 to $2.3 billion, in line with the broader regional trend for Southeast Asia.
“The Southeast Asia Aid Map shows the ongoing importance of official development finance to Cambodia and the region, particularly its role in funding infrastructure, health, education and poverty reduction initiatives. Therefore, the decline in official development finance to the country is concerning,” Alexandre Dayant, Senior Economist and Deputy Director of the Indo-Pacific Development Centre, Lowy Institute, told the Khmer Times.
International partners have sharply reduced development support to Cambodia, even though the country’s economy remains fragile and below pre-pandemic levels. China, which provided over a third of Cambodia’s development finance from 2015-2022, saw its support drop to its lowest point in 2022.
“Chinese financing has plummeted to its lowest level on record in the country, which aligns with a regional trend of Chinese development assistance in the region. Once the primary development partner for half of Southeast Asian countries, Beijing now holds that position only for Malaysia and Laos,” said Dayant.
However, the Southeast Asia Aid Map shows that regional powers like India, Japan, and Korea have stepped up, suggesting that while Cambodia may not pivot to the traditional West, its pool of development partners could expand.
The major projects in the country that have received funding from international partners include the 7th Cambodia-China Friendship Bridge, the pre-services education system for healthcare professionals in Kampot, Sihanoukville port, upgrading of National Road 48, 44, 70, Kratie Bridge over Mekong, Prey Lang Wildlife Sanctuary, among others.
While Cambodia became a lower middle-income country in 2015, with ambitions to reach upper middle-income status by 2030, it still faces many challenges – particularly with respect to population of more than 16.7 million having a GDP per capita of $1760, which is the second-lowest in the region after Myanmar.
While the Lowy Institute said, Cambodia has seen impressive poverty reduction and some of the fastest economic growth in the world since the formal end of civil conflict in 1991 – still the country faces significant development challenges.
Governance remains a primary barrier to growth and development, said the institute which noted the region had implemented 15,000 projects between 2015–22.
