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Country Report Cambodia October 2017

Country Report Cambodia October 2017

  • October 2017
  • ID: 360768
  • Format: PDF
  • The Economist Intelligence Unit


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Outlook for 2018-22

  • The prime minister, Hun Sen, and the Cambodian People's Party (CPP) will remain in power. De facto one-party rule will persist given the heavy-handed suppression of the main opposition Cambodia National Rescue Party (CNRP).
  • The election scheduled for July 2018 is unlikely to be held in a free and fair environment. The CPP's political intimidation of the CNRP and civil society will persist, and its threat to retain power by force if it loses remains credible.
  • The National Bank of Cambodia (NBC, the central bank) will manage a slowdown in rapid credit growth in the first half of the forecast period. Macroprudential measures will remain the mainstay of monetary policy.
  • Real GDP growth will remain strong throughout 2018-22, averaging 7.1% a year owing in large part to robust private consumption activity amid rapidly rising incomes. Investment spending growth will moderate but remain solid.
  • Consumer price inflation will remain steady at an average annual rate of 3.4% in 2018-22. The dollarised economy is a stabilising force and commodity prices are unlikely to be as volatile as they have been in recent years.
  • The current-account deficit will remain wide in 2018-22, averaging 8.9% of GDP. However, inflows of foreign direct investment, worth 6.5% of GDP a year on average, will prevent any major balance of payments difficulties.


  • In a speech on September 6th Hun Sen announced that he would run as a candidate in the next two elections in order to "maintain peace". The prime minister has ruled Cambodia in various guises since 1985.
  • During a joint press conference in the capital, Phnom Penh, Hun Sen and his Thai counterpart, Prayuth Chan-ocha, announced their intention to open more border checkpoints and restart construction on the Phnom Penh-Bangkok railway project, which commenced in 2008.
  • On September 14th Hun Sen announced the unilateral suspension of joint searches for the remains of US soldiers killed during the Vietnam war. The suspension was introduced in response to the impositions on September 13th of US visa restrictions on some Cambodian government officials.
  • According to data released by the Asian Development Bank on September 7th, the government's budget deficit narrowed to the equivalent of 1.5% of GDP in 2016, from 2.6% in the previous year.
  • The latest data from the Ministry of Tourism show that Cambodia welcomed just over 378,000 tourists in June, representing an increase of 14.5% year on year. In total, the country received 2.7m international visitors in January-June, up from 2.4m in the same period in 2016.

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