Cambodia Economy Facts
Cambodia has always been a prominent agricultural country. A majority of the inhabitants are still dependent on mainly rice cultivation for their living. But since democratization in 1993, industry, mainly textile production, and tourism has grown significantly in importance and now accounts for a larger part of the economy than agriculture does. Clothing exports alone generate around 70 percent of export revenue.
Cambodia has in a short time been transformed from a war-torn, seemingly hopeless case to one of Asia’s success stories. The economy grew by almost 10 percent a year in 1998–2007. The global crisis of 2008-2009 hit hard on both tourism and clothing exports. Growth stopped almost completely but soon gained momentum again and was around 7 percent in the 2010s.
- Countryaah.com: Major imports by Cambodia, covering a full list of top products imported by the country and trade value for each product category.
Despite good growth, Cambodia is still a poor country. Although growth has benefited many poor people, the economic gaps in the population are deep and growing. Particularly large is the difference between city and countryside; the majority of the poor live in the countryside.
Economic growth has largely been driven from abroad. Tourism has increased as security is strengthened through increased political stability, and the textile industry has grown at a rapid pace through foreign investment. This has been done by attracting investors with cheap labor, few regulations and almost unlimited opportunities to bring profits out of the country. In 2016 and 2017, direct investment from China increased sharply, primarily in infrastructure. Other important investors are Hong Kong, Vietnam and Japan.
Around mid-2010, growth in the textile industry slowed somewhat, mainly due to increased competition from other low-wage countries. Cambodia fought with high costs for electricity and transport. At the same time, exports of machinery and car parts increased.
- Abbreviationfinder.org: Check this abbreviation website to find three letter ISO codes for all countries in the world, including KHM which represents the country of Cambodia. Check findjobdescriptions to learn more about Cambodia.
Large sums are donated to the Treasury through the assistance of a wide range of donors, of which the Asian Development Bank, Japan, the United States and China are among the largest . In total, donors account for one third of the country’s budget, a substantial reduction compared to 2010 when 60 percent of the budget was aid. The donors are concerned by the aggressive land policy and the lack of respect for human rights. In 2011, the World Bank announced that no new loans would be granted until the Cambodian government reached a settlement with residents who risked being driven away from their homes in an area in Phnom Penh (see Calendar). After a number of residents received permission from the government to stay in the area, the World Bank granted new loans to Cambodia in May 2016.
The challenges for Cambodia are still great. The country has a shortage of trained labor, electricity costs are high and public administration is inefficient and corrupt. Agriculture has stagnated due to a lack of investment in irrigation systems and other infrastructure and poor utilization of land (see Agriculture and Fisheries). The banking system is deficient. Many rural residents buy livestock for their savings capital rather than deposit money at the bank.
In February 2020, the EU withdrew some of the trade benefits enjoyed by Cambodia on the Union market through the Everything but arms (EBA) trade agreement. The restriction involves fees of around one-fifth of the country’s annual exports to the EU and will entail increased costs for Cambodia of $ 1.5 billion. The decision was made as a consequence of growing democratic shortcomings in Cambodia, such as political repression of opposition and defective labor law (see Democracy and Rights).
FACTS – FINANCE
GDP per person
US $ 1,512 (2018)
US $ 24,572 million (2018)
7.5 percent (2018)
Agriculture’s share of GDP
22.0 percent (2018)
Manufacturing industry’s share of GDP
16.3 percent (2018)
The service sector’s share of GDP
39.5 percent (2018)
2.2 percent (2019)
Government debt’s share of GDP
28.6 percent (2018)
US $ 11,898 million (2017)
fittings; even US dollars are often used
US $ 12 963 million (2018)
US $ 18 806 million (2018)
– US $ 2,773 million (2018)
Commodity trade’s share of GDP
136 percent (2018)
Main export goods
clothing and other textile products, shoes
Largest trading partner
Another prison sentence for Rainsy
Opposition leader Sam Rainsy is sentenced to second imprisonment for the second time, this time for ten years. In January 2010, he was sentenced to two years in prison (see January 2010). Rainsy, who lives in exile in Paris, is convicted of making changes to an official map of the border with Vietnam, in order to prove that the government has given up territory.
Relations with Thailand are restored
The diplomatic relations between Cambodia and Thailand are restored when Thaksin Shinawatra resigns as economic adviser (see November 2009).
Long prison sentence for Duch
The Red Khmer Tribunal sentenced the former prison chief Duch to 35 years in prison for thousands of murders and cases of torture and crimes against humanity (see Political system).
Sam Rainsy is sentenced to prison
Opposition leader Sam Rainsy, who went into exile in Paris, is sentenced in his absence to fines and two years in prison for incitement against ethnic groups (Vietnamese) and vandalism. The crimes must have been committed in connection with popular protests against border markings against Vietnam, a sensitive issue in Cambodia.