Cambodia’s economy is projected to continue its momentum with an expected growth rate of approximately 6.3 percent, according to the Royal Government’s assessment of the medium-term public financial framework for 2025.
The assessment was made in the statement on the draft Law on Finance for Management 2025 released by the Ministry of Economy and Finance this week.
The report said, “The economic growth is anticipated to increase the Gross Domestic Product (GDP) to around 209,163 billion riels, equivalent to about $51.39 billion, while GDP per capita income is expected to rise to $2,924, compared to approximately $2,713 in 2024.”
The projected 6.3 percent economic growth in 2025 is driven by key sectors such as the industrial sector, service sector and agricultural sector, the statement said.
The industrial sector is expected to grow by 8.6 percent with strong performance in garment and non-garment manufacturing. Garment growth will be supported by global demand and the ‘Cambodia Footwear and Bag Development Strategy 2022-2027,’ while non-garment manufacturing benefits from export growth and government support for SMEs.
Food and beverage production is also set to expand and the construction sector is forecast to grow slowly due to subdued foreign investment and housing construction. Meanwhile, medium-term growth will focus on housing demand and industrial, factory, and commercial construction activities.
The services sector is projected to grow by 5.6 percent in 2025, driven by hospitality, tourism, real estate, transport, financial, and ICT sub-sectors.
In the service sector, tourism will benefit from rising domestic and international visitors, supported by initiatives like the ‘Siem Reap Tourism Master Plan 2021-2035’ and ‘Visit Siem Reap 2024.’
Real estate growth will be slower, focusing on low- and middle-income housing. Transport and warehousing will expand with infrastructure improvements under the ‘Inter-Transport and Logistics Master Plan 2023-2033.’
Financial and ICT sectors, regarded as the service sector, will thrive through modernization and policies like the ‘Financial Technology Development Policy 2023-2028’ and ‘Digital Economy Framework 2021-2035.’
The agricultural sector is projected to grow by 1.1 percent in 2025, driven by crops, livestock, and fisheries. Crop growth will benefit from increased investment, public financing, and free trade agreements boosting exports.
Livestock is expected to recover gradually due to measures restricting frozen meat imports. Fisheries will grow modestly, supported by anti-illegal fishing policies, aquaculture investments, and technical support to improve efficiency and sustainability.
Hong Vannak, an economic researcher at the Royal Academy of Cambodia (RAC), told Khmer Times that the projected per capita GDP of nearly $3,000 in Cambodia by 2025 does not accurately reflect the country’s economic situation, particularly the actual conditions faced by the people, who are struggling.
He said that the debt levels of households and individuals in the banking system are causing significant problems with repayment. Additionally, inflation in the market continues to rise, while incomes and personal savings have sharply declined.
Regarding the GDP forecast, he stated, “A projected per capita GDP of nearly $3,000 by 2025 is too high. Compared to a decade ago, when Cambodia’s GDP per capita was around $1,000, the figure has only reached $2,071 by 2024.”
“Given the fact that it took us more than a decade to achieve $2,071, to estimate that per capita GDP will jump to $2,924 in just one year does not accurately reflect the realities of Cambodia’s society and the economy,” he said.
Despite his concerns, Vannak remains optimistic about Cambodia’s economic progress. He believes that economic growth will increase income levels for the people of Cambodia, aligning with the government’s vision to achieve upper-middle-income status by 2030 and high-income status by 2050.
Aun Pornmoniroth, Deputy Prime Minister and Minister of Economy and Finance, said recently that, in 2025, the economy is projected to grow around six percent and 6.3 percent, mainly supported by continued momentum in export-oriented sectors, especially the garment sector.
Accommodation and other supporting sectors (tourism) are expected to continue an upward trend and move toward the pre-pandemic level, he said.
Meanwhile, resilient momentum in the non-garment sector will continue with newly emerging production industries, especially automotive assembly, food, and beverage productions, he added.
However, Cambodia’s GDP growth is projected to marginally improve, reaching 5.5 percent in 2025 and 2026, according to the World Bank’s ‘Cambodia Economic Update: From Recovery to Resilience – Harnessing Tourism and Trade as Drivers of Growth,’ released recently.
