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Cambodia Economic Profile

Cambodia is a lower-middle-income country located in Southeast Asia, having achieved rapid economic growth in recent years. With a nominal GDP of approximately $28 billion in 2023 and a population of about 17 million, this small nation plays an important economic role in the region. The economic structure is built on three pillars: agriculture, tourism, and manufacturing. Rice production is the country's primary agricultural product, with the fertile Mekong River Delta providing a robust agricultural foundation.

Manufacturing is the largest industrial sector driving Cambodia's economic growth. The apparel and textile industry dominates with an overwhelming market share, serving as a manufacturing hub for many international companies due to low labor costs. Tourism is also significant, with visits to UNESCO World Heritage sites such as Angkor Wat being a major source of foreign exchange. However, the tourism sector suffered greatly from the COVID-19 pandemic.

Regarding recent economic trends, Cambodia has demonstrated strong recovery. GDP growth rates have exceeded 5% between 2022 and 2023, with inflation remaining under control. The rapid recovery in tourist numbers, strong manufacturing performance, and increased foreign direct investment from China are supporting growth. In particular, investment in economic special zones and infrastructure projects by Chinese capital is accelerating, positioning Cambodia as an important partner in China's Belt and Road Initiative.

Notable concerns include widening income inequality and labor exploitation issues. Textile industry workers earn among the lowest wages in the region, making labor condition improvements urgent. Political stability and anti-corruption measures also affect the investment environment. Additionally, vulnerability to climate change poses challenges, with flooding and droughts threatening agricultural productivity and food security. For sustainable economic development going forward, industrial diversification, human capital development, and institutional strengthening are crucial.