Cambodia 20250106: Pneumatic, Fungible, Energetic
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Headlines:
Economic Growth and Trade Connections
Special Economic Zones Booming
Construction Sector Outpaces Region
Raw Cashew Export Success
Wage Increases and Price Controls
Infrastructure Development Push
Skills Development Program Takes Off
China Relations Strengthen Over Past Year
Port City Development Vision
Tax Agreement Progress
Environmental Works Ongoing
Cruise Tourism Growth
Crime Prevention Measures
Economic Growth and Trade Connections
The nation is expecting the final tally for 2024 economic growth to tip in at 6%, mostly due to exports, a tourism revival, and increased private consumption. Manufacturing, particularly garments and footwear, remains a pillar of the economy. Agriculture growth is expected at 1.2% in 2024 and 1.3% in 2025. Services sector growth is forecast at 5.4% in 2024. Trade with ASEAN reached $14.3B in 11 months of 2024, up 12.8%. Bilateral trade with South Korea hit $762 million, showing 11.49% growth. RCEP exports increased 14.4% to $8.25 billion.
Read more: Khmer Times (Economic Outlook), Khmer Times (ASEAN Trade), Khmer Times (Korea Trade), Khmer Times (RCEP Exports)
Special Economic Zones Booming
Special Economic Zones delivered $5.4 billion in exports during the first 11 months of 2024. The Cambodia Development Council approved 49 SEZ projects, with 26 already up and running. The 16 active SEZs, home to 431 factories and enterprises, employ 183,703 workers. These zones are important drivers of industrial growth and job creation in the nation and their influence on the economy is expected to continue.
Read more: The Star
Construction Sector Outpaces Region
Construction industry growth is expected to reach 7.3% annually over the period 2026-2028, up from a but under 6% in 2024 and a bit over 2025’s expected 6.8%. This growth rate is bigger that the Southeast Asia's regional average of 6% for 2025-2028. The expansion is being actively supported by the government's transport and logistics system master plan for 2023-2033.
Read more: Khmer Times
Raw Cashew Export Success
Last year saw raw cashew nut exports of 815,000 tonnes, earning $1.15 billion - a 31% increase in value and 24% rise in volume. Vietnam was the buyer of the vast majority of the product: 97.3% of these exports. Cambodia has become the world's second-largest producer of raw cashew.
Read more: Khmer Times
Wage Increases and Price Controls
The government has put in place a $208 minimum wage for garment, textile, footwear, and travel goods sector employees. Workers are expected to get additional benefits bringing total monthly compensation to something in the range of $230-300. The Labor Ministry is asking landlords and other businesses not to raise rentals or prices so that the benefits of the wage lift go toward labor. Civil servants and members of the armed forces are also expected to receive salary increases in 2025.
Read more: Khmer Times (Wage Policy), Khmer Times (Price Controls)
Infrastructure Development Push
The $200 million Dara Sakor International Airport started domestic charter operations, targeting 7 million annual passengers initially. The new Techo International Airport, has been designed to handle 13 million passengers annually, at least to start. The 180-km Funan Techo Canal project is still raising environmental concerns about impacts on floodplains and agriculture. Will it be finished? Anyone’s guess.
Read more: Business Traveller (Dara Sakor), The Star (Techo Airport), Nature (Canal Impact)
Skills Development Program Takes Off
Nearly 80,000 youth enrolled in the government's Technical and Vocational Education and Training program. Of these, 30,000 are in training, and 20,000 have completed at least one course. The TVET 1.5M initiative wants to get a million and a half youth from poor and vulnerable families engaged by offering free training while allowing participants to earn income.
Read more: Khmer Times
China Relations Strengthen Over Past Year
Cambodia and China closed out the 2024 the "Cambodia-China People-to-People Exchange Year," chalking it up as a win to bilateral relations in culture, tourism, and the economy. China remains Cambodia's top trading partner. Both countries recently agreed to work more closely on beating cybercrime and promoting cross-border e-commerce cooperation - mostly via digital technology development and market access.
Read more: Khmer Times (Bilateral Relations), Khmer Times (Cybercrime Prevention)
Port City Development Vision
Preah Sihanouk province is expected to hit a GDP per capita tally in excess of $13,000 within 15 years, which would make it a major ASEAN industrial and logistics hub. The development strategy could pull in more than $420 billion in investments in industry, logistics, trade, tourism, and finance.
Read more: Khmer Times
Tax Agreement Progress
Cambodia and France have finished up their third round of talks on a Double Taxation Agreement. Cambodia already has DTAs with Singapore, China, Thailand, Brunei, Vietnam, Indonesia, Hong Kong SAR, Malaysia, and South Korea. Bilateral trade with France reached $467 million in the first eleven months of 2024.
Read more: Khmer Times
Environmental Works Ongoing
The Ministry of Environment has lifted its suspension on carbon trading investments. Previous carbon credit sales generated $11.6 million from three wildlife sanctuaries. The government says that it wants to explore additional carbon credit sales from other protected areas to pull in more international green investments.
Read more: Khmer Times
Cruise Tourism Growth
International cruise ships are bringing more visitors to Cambodia than ever through Sihanoukville port. Recent arrivals included AIDAstella with 2,757 people and Seabourn Encore carrying approximately 500 international tourists from 33 countries.
Read more: Khmer Times
Crime Prevention Measures
Interior Minister Sar Sokha has announced plans to increase the number of police officers to at least 10 per commune by the end of next year. The government has recently increased efforts to tamp down online gambling, with new legal measures against promoters and the establishment of an inter-ministerial working committee to work on the problem.
Read more: Khmer Times (Police Force), Khmer Times (Gambling Prevention)
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