General Overview

Cambodia Investor Club (CIC)

https://www.kh.undp.org/content/cambodia/en/home/countryinfo.html
https://www.worldbank.org/en/country/cambodia/overview
65.3% Under the age 30

68.8% Life Expectancy at birth (HDI 2015)

4.7 Mean years of schooling

1215 GDP Per Capita (USD)

80% Rural population

13.5% Poverty headcount at the National Poverty Line

Statistics – Capital: Phnom Penh

Population: 16 million (2017)

Area (in sq .km): 181,035

Language(s): Khmer

** Infographic ideas:

    1. Snapshot + Statistics
    2. Cambodian Population (graph from 2012 – 2019?)
    3. Graph Cambodian GDP and GDP per Capita (graph from 2012 – 2019?)
    4. MSMEs play a significant role in developing Cambodian Economy.
    5. Cambodian MSMEs Composition by Industry (%of total enterprises)

*** Top 3 industries are wholesales & retails, manufacturing & accommodation and food services. However, the majority of these MSMEs are not properly registered.

INTRODUCTION

The Kingdom of Cambodia is situated in the southwest of the Indochinese peninsula and has a rich culture that dates back 2,000 years ago. The country has a land area of 181,035 square kilometers and a population of 16 million people (2017). Like in the rest of Southeast Asia, Cambodia’s climate is characterized by two main seasons: the monsoon, which brings rain from mid-May to October, and dry season from November to April.

Economically, Cambodia has enjoyed strong growth rates during the past decade. Economic performance had positive statistics telling of an average GDP growth of 8.2% between 2000-2010, and 7.4% from 2011-2013. GDP per capita is US$1,215 [2016, MEF] compared to approximately US$200 in1992. As a result, Cambodia’s economic status has now been upgraded as a low Middle Income Country.

MARKET OVERVIEW

Two Decades of growth

Cambodia has pursued policies and reforms to integrate

Over the past two decades, Cambodia has undergone a significant transition, reaching lower middle-income status in 2015 and aspiring to attain upper middle-income status by 2030. Driven by garment exports and tourism, Cambodia’s economy has sustained an average growth rate of 8% between 1998 and 2018, making it one of the fastest-growing economies in the world. While easing slightly, growth remained strong, estimated to have reached 7.1% in 2019, after the better-than-expected growth rate of 7.5% in 2018.

Significance of Private Sector and SMEs

History

Cambodia gained its independence in 1953. Since then and through to 1970, it was a self-sufficient and prosperous country that excelled in many areas of development. Following an extended period of civil war, the Paris Peace Accord in 1991 created the United Nations Transitional Authority (UNTAC), which was backed by some 22,000 United Nations peacekeepers to prepare the first free and fair election in the country. In May 1993, UNTAC supervised Cambodia’s first general election. His Majesty Preah Bat Norodom Sihanouk was reinstated as King. In 2004, he abdicated the throne and his son, Norodom Sihamoni, was elected by the Throne Council to be the King of Cambodia in October that year. Former King Sihanouk passed away in October 2012.

Cambodia is a party to a number of international conventions. They include Anti-Personnel Mine Ban Convention (Ottawa Treaty; ratified July 1999), Convention on the Elimination of All Forms of Discrimination against Women (CEDAW; ratified October 1992), UN Framework Convention on Climate Change (UNFCCC; ratified December 1995), Convention on the Rights of Persons with Disability (CRPD; December 2012), Convention on the Rights of the Child (CRC; ratified October 1992), and several international covenants on social, cultural, economic and political rights.

Challenges

 The global shock triggered by the COVID-19 pandemic has significantly impacted Cambodia’s economy in 2020 at a time when Cambodia also faces the partial suspension of preferential access to the EU market under the “Everything but Arms” initiative. The outbreak caused sharp deceleration in most of Cambodia’s main engines of growth in the first quarter of 2020, including weakened tourism and construction activity. Growth is projected to slow sharply to 2.5 percent in 2020 under the baseline scenario. The COVID-19 outbreak and slow recovery in global economic activity alongside prolonged financial market turmoil pose risks to Cambodia’s growth outlook. 

Poverty continues to fall in Cambodia. According to official estimates, the poverty rate in 2014 was 13.5% compared to 47.8% in 2007. About 90% of the poor live in the countryside. While Cambodia achieved in 2009 the Millennium Development Goal (MDG) of halving poverty, the vast majority of families who escaped poverty did so by a small margin. Around 4.5 million people remain near-poor, vulnerable to falling back into poverty when exposed to economic and other external shocks.

Health and education, especially quality, remain important challenges and development priorities.

Cambodia has made considerable strides in improving maternal and child health, early childhood development, and primary education in rural areas. The maternal mortality ratio per 100,000 live births decreased from 472 in 2005 to 170 in 2014; the under-five mortality rate decreased from 83 per 1,000 live births in 2005 to 35 per 1,000 live births in 2014; and infant mortality rate decreased from 66 per 1,000 live births in 2005 to 28 per 1,000 live births in 2014.

Despite the progress in health and education outcomes, human capital indicators lag behind lower middle-income countries. A child born in Cambodia today will be only 49% as productive when grown as she could be if she enjoyed full quality education, good health, and proper nutrition during childhood. An estimated 1 in 3 children under the age of five suffer from stunting and only 36% of children between three and five years old are enrolled in early education.

While net enrollment in primary education increased from 82% in 1997 to 97% in 2016, lower secondary completion rates, at 57% in 2017, are significantly below the average for lower middle-income countries. As of 2017, 21% of Cambodia’s population (3.4 million people) did not have access to improved water, and 34% (5.4 million people) did not have access to improved sanitation.

Key reforms are needed for Cambodia to sustain pro-poor growth, foster competitiveness, sustainably manage natural resource wealth and improve access to and quality of public services. Cambodia continues to have a serious infrastructure gap and would benefit from greater connectivity and investments in rural and urban infrastructure. Further diversification of the economy will require fostering entrepreneurship, expanding the use of technology and building new skills to address emerging labor market needs. Accountable and responsive public institutions will also be critical to meeting the evolving needs of citizens and the private sector.  And quality of human capital will be of utmost importance to achieve Cambodia’s ambitious goal of reaching middle-income status by 2030.