The blow to Cambodia’s economy from the COVID-19 pandemic was among the most pronounced in East Asia, but the country can regain sustained economic growth by increasing productivity among firms and workers, diversifying exports, and taking steps to boost domestic investment, the World Bank says in its Cambodia Economic Memorandum.
Cambodia’s growth rate, which averaged a robust 7.7 percent between 1995 and 2019, plunged an estimated 10.1 percentage points to contract by 3.1 percent in 2020 before resuming modest growth of 2.2 percent in the year just ended. The dramatic slowdown in output can be attributed in large part to the pandemic, but Cambodia’s dependence on a narrow range of products, markets, and financing sources left it poorly positioned to absorb the shocks, according to the report, Resilient Development, a Strategy to Diversify Cambodia’s Growth Model.
