2024-12-29-世界银行-柬埔寨经济更新_2024年12月_从复苏到韧性——利用旅游业和贸易作为增长动力（英）_58页_6mb

Summary of Cambodia Economic Update (December 2024)

Recent Economic Developments

Cambodia's economy showed marginal improvements in 2024, driven by revivals in services and goods exports, particularly in tourism and garment manufacturing. The economy was supported by sustained foreign direct investment (FDI) inflows, private consumption, and monetary policy accommodation amid global economic recovery. Challenges included subdued inflation due to declining energy and food prices, domestic credit growth slowdown amid a property market downturn, and moderate outward foreign exchange reserve growth. The overall fiscal deficit narrowed to 27% of GDP, reflecting budget consolidation efforts despite pressures.

Special Focus: Structural, Firm, and Business Barriers to Labor Productivity

Labor productivity among Cambodian firms was significantly lower than regional peers, with manufacturing firms averaging $4,784 per worker compared to services’ $8,555 and the regional median of $6,659. Productivity varies widely based on location, sector, and size, with firms in Phnom Penh being the most productive and those in mountainous regions the least. Frontier firms, though few, contribute disproportionally but remain below the regional productivity frontier. Key barriers include:

• Informal Economy Competition: Most firms compete with informal operations, a bigger concern outside Phnom Penh and for smaller firms.
• Infrastructure Deficiencies: Transport and electricity remain moderate concerns, though longer wait times for services like business licenses and imports highlight bureaucratic inefficiencies.
• Skills Shortages: While workforce education and skills concerns are lower than peers, they are more acute among firms in remote areas and larger, export-oriented firms.
• Access to Finance: Despite a credit boom, leverage ratios are low, and informal payments to secure loans remain high among certain groups.
• Tax Administration: Cumbersome tax processes and high informal payments during tax interactions drag down business operations.
• Corruption and Courts: Widespread informal payments hinder business operations, and judicial processes are seen by 25% of firms as biased.

Challenges and Risks

Near-term risks include weaker global demand amid elevated debt and monetary tightening, sharper growth slowdown in China, and continued property market challenges. Domestically, a sharper-than-anticipated property downturn and household debt pressures could constrain consumption.

Policy Options

To enhance productivity and economic growth:

• Accelerate Structural Transformation: Align sectors toward higher-value activities and promote rural-urban shifts.
• Targeted Support for Firms: Streamline business registration, enhance access to finance, and reduce the cost of operations for medium-sized and frontier firms.
• Infrastructure and Skills Development: Prioritize transport and digital infrastructure and vocational training to boost productivity.
• Revenue Mobilization and Public Financial Management: Strengthen tax systems and fiscal discipline to narrow fiscal deficits.
• Financial Sector Stability: Enhance bank supervision, resolve nonperforming loans (NPAs), and improve corporate governance.
• Public Service Improvements: Fast-track reforms to ease business registration, cross-border trade, and insolvency processes.

Cambodia must address structural and informal economy barriers to unlock productivity gains and diversify its export base, especially in services and digital sectors.

Data Highlights

• GDP growth slowed from pre-pandemic averages but showed steady improvement.
• Manufacturing exports surged but are vulnerable to external fluctuations.
• Current account deficit remains modest, financed by FDI and remittances.
• Public debt-to-GDP ratio fell to 24.4%, below the 30% threshold.

Conclusion

Cambodia is set to moderate economic growth on the back of manufacturing, services, and FDI but faces challenges to becoming a high-income economy due to low productivity and informal barriers. Urgent reforms in tax, judiciary, and infrastructure are imperative for sustainable growth.