GDP growth for 2021 targetted at 3 percent

GDP growth for 2021 targetted at 3 percent

Prime Minister Hun Sen has expressed optimism that the Kingdom’s GDP growth this year will reach around 3 percent, which is more than the rate mentioned in the budget bill.

Speaking at the inauguration ceremony of Hyatt Regency Phnom Penh yesterday, Mr Hun Sen said the growth is optimised to reach beyond the 2.4 percent rate stated in the Budget Bill 2022.

The recovery of economic and social activities and the service sector are the main factors boosting the growth increase beyond the previous projection, he said.

“Based on my optimistic assumption, the country’s economic growth in 2021 will be around 3 percent, although we set 2.4 percent in the budget bill,” Mr Hun Sen said.

An international organisation in October projected the Kingdom’s economic growth at 2.8 percent, he said.

“The growth will definitely reach at 2.9 percent or 3 percent or may be over 3 percent,” Mr Hun Sen added.

The service sector, mainly the tourism – both domestic and foreign tourists is on the trend of recovery, the Prime Minister said.

Ministry of Economy and Finance Secretary of State Phan Phalla said the activities in the economy sector in Cambodia have started to recover since the government reopened the country.

“Because of the vaccination campaign, herd immunity has been made. This has led to the reopening of economic and social activities and the projection of GDP growth of 2.4 percent may be not right,” he said in a press conference held on Tuesday at the Government’s Spokesman Unit.

The exports of main products in the eleven months this year were on the strong path, Phalla said.

In the eleven months of 2021, the garment export increased by 13.6 percent, compared to the same last year at 10 percent, non-garment product export increased by 53 percent, while agriculture product export increased remarkably, he said.

The main drivers of GDP growth in 2021 are the garment sector, non-garment sector, agriculture sector, and real estate sector, he said.

“In addition, after reopening the economic activities, we have seen that economic activities are on the strong path and at a better position,” Phalla said.

Cambodia’s real GDP growth is projected to reach 2.2 percent this year, impeded by slow growth in services including tourism, and in construction, and real estate. While other traditional growth drivers, especially the garment, travel goods, footwear and bicycle manufacturing industries, as well as agriculture, are underpinning the economic recovery, according to Living with Covid-19, the World Bank’s latest Economic Update for Cambodia, issued on December 9.

Cambodia’s growth outlook is expected to continue to recover as Covid-19-related restrictions are lifted. Growth is projected to reach 4.5 percent in 2022, but any renewed spread of the virus could put the recovery at risk. Khmer Times