IMF projects slow growth for Cambodia due to trade disruptions, border tensions

Alsharq Tribune-Otaify 

Cambodia's economic growth is projected to decelerate to 4.8 percent in 2025 and 4 percent in 2026, reflecting export volatility, declining remittances, a slowdown in tourism, and weak domestic demand, the International Monetary Fund (IMF) said on Wednesday.

Cambodia's growth reached 6 percent in 2024, but a confluence of shocks -- trade disruptions, border tensions, and anemic credit growth -- exposed the economy's vulnerabilities, and signs of economic slowdown are emerging in the second half of 2025, said an IMF press release.

"The downward revision reflects remittance losses and a tourism slowdown, which are expected to weigh on domestic demand," the press release said. "Tariff effects will lower export earnings as manufacturers face margin pressures."

On Aug. 1, the United States imposed a 19 percent tariff on all goods imported from Cambodia.

Prudent fiscal and monetary policies, together with structural reforms, are essential to safeguard stability and strengthen resilience, the press release said, adding that near-term measures should cushion external shocks while laying the foundation for medium-term competitiveness.

According to the press release, Cambodia's inflation is projected to rise modestly in 2025 before easing in 2026.