## IMF Executive Board Concludes 2024 Article IV Consultation with Cambodia

_IMF News, January 27, 2025_

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## Bibliographic details
- Published: January 27, 2025

---

### Overview and growth projections
- The Executive Board concluded the Article IV consultation with Cambodia.
- Cambodia’s economy continued to recover, albeit at a modest pace.
- Real GDP:
  - 2024: 5.5 percent
  - 2025 (projected): 5.8 percent
- Inflation:
  - 2024: 0.5 percent
  - 2025 (projected): 2 percent
- Risks to the outlook are tilted to the downside from external factors and domestic vulnerabilities, including:
  - policy changes by major trading partners,
  - geoeconomic fragmentation,
  - continued weakness in the construction and real estate sectors.

### Drivers of the recovery and sectoral outlook
- Recovery characteristics:
  - Growth driven mainly by external demand.
  - Strong rebound in garment exports and high growth in agricultural exports.
  - Tourism experienced a structural shift in its composition, causing a lagged recovery in tourism receipts.
  - Growth in non-tradable sectors remains weak.
- Credit and sector corrections:
  - Credit-to-GDP ratio rose from 24 percent in 2010 to 135 percent in 2023 after sustained credit expansion.
  - Credit growth has come to a near halt.
  - Construction and real estate sectors undergoing a correction, with rising non-performing loans and emerging signs of private-sector debt overhang.

### Fiscal stance, public finance, and external balances
- Fiscal projections and stance:
  - Fiscal deficit:
    - 2024: 3 percent
    - 2025 (projected): 2.4 percent of GDP
  - Medium-term fiscal framework envisages gradual fiscal consolidation.
  - Public debt remains below 30 percent of GDP over the next decade.
- Current account and external sector:
  - Current account balance:
    - 2024: deficit of 1.8 percent of GDP
    - 2025 (projected): deficit of 2.5 percent of GDP
  - Drivers: strong demand for imports outpacing recovery in exports and tourism; export growth expected to moderate.

### Executive Board assessment and policy recommendations
- Overall assessment:
  - Directors welcomed the continuing recovery driven by garment and agricultural exports and improving tourism activity.
  - Recovery is uneven; risks are tilted to the downside.
  - Importance stressed on policies to safeguard macrofinancial stability, ensure a durable and inclusive recovery, and achieve medium-term development goals.
- Fiscal policy recommendations:
  - Support for a neutral fiscal stance in the near term.
  - Importance of gradual and high-quality consolidation over the medium term underpinned by sound fiscal frameworks to maintain debt sustainability and strengthen resilience.
  - Strengthen the medium-term fiscal framework with more conservative and transparent fiscal rules.
  - Further mobilize revenues through rationalizing tax exemptions and implementing tax policy reforms.
  - Enhance spending efficiency and strengthen public investment management to rebuild fiscal buffers and safeguard priority social and capital spending.
  - Foster development of the domestic government bond market as access to concessional foreign financing will be reduced when Cambodia graduates from Least Developed Country status.
  - Sound management of fiscal risks from state-owned enterprises and public-private partnerships.
- Monetary and financial sector recommendations:
  - Support for a measured pace of monetary policy normalization while maintaining adequate financial system liquidity.
  - Continue efforts to modernize the monetary policy framework to enhance policy transmission and support de-dollarization.
  - Phase out forbearance measures and develop a comprehensive plan to safeguard financial stability given corrections in construction and real estate sectors, declining FDI inflows, and rising nonperforming loans.
  - Strengthen risk-based supervision, improve macroprudential policy, enhance coordination among financial sector supervisory agencies, and intensify oversight of the real estate sector.
- Structural and governance recommendations:
  - Promote economic diversification and improve competitiveness through structural reforms.
  - Enhance human capital, invest in infrastructure, strengthen the business environment, address climate vulnerabilities, and promote renewable energy to attract more diversified FDI.
  - Strengthen governance and institutions, improve transparency, enhance the AML/CFT framework, and address data limitations through capacity development.

### Key statistics and selected indicators (highlights from Table 1)
- Per capita GDP (2022, US$): 1,546
- Population (2022, million): 16.7
- Life expectancy (2019, years): 75.5
- Literacy rate (2019, percent): 87.7

- Output and prices (annual percent change):
  - GDP at constant prices:
    - 2021: 3.1
    - 2022: 5.1
    - 2023: 5.0
    - 2024: 5.5
    - 2025 (proj.): 5.8
    - 2026 (proj.): 6.2
    - 2027 (proj.): 6.0
  - Inflation (end-year):
    - 2021: 3.7
    - 2022: 2.9
    - 2023: 2.7
    - 2024: 1.5
    - 2025 (proj.): 2.1
    - 2026 (proj.): 3.2
    - 2027 (proj.): 3.0
  - Inflation (annual average):
    - 2021: 5.3
    - 2022: 0.4

- Saving and investment (in percent of GDP):
  - Gross national saving:
    - 2021: 0.8
    - 2022: 15.6
    - 2023: 33.6
    - 2024: 30.7
    - 2025 (proj.): 30.0
    - 2026 (proj.): 29.2
    - 2027 (proj.): 29.3
  - Government saving:
    - 2021: 0.3
    - 2022: 4.1
    - 2023: 6.1
    - 2024: 7.1
    - 2025 (proj.): 8.1
    - 2026 (proj.): 9.1
    - 2027 (proj.): 10.1
  - Private saving:
    - 2021: 0.5
    - 2022: 12.5
    - 2023: 29.5
    - 2024: 25.6
    - 2025 (proj.): 23.9
    - 2026 (proj.): 22.1
    - 2027 (proj.): 21.1
  - Gross fixed investment:
    - 2021: 30.4
    - 2022: 34.6
    - 2023: 32.3
    - 2024: 32.5
  - Government investment:
    - 2021: 6.6
    - 2022: 5.6
    - 2023: 5.2
    - 2024: 4.5
    - 2025 (proj.): 4.3
    - 2026 (proj.): 4.2
    - 2027 (proj.): 3.9
    - 2028 (proj.): 3.8
  - Private investment:
    - 2021: 23.8
    - 2022: 29.0
    - 2023: 26.5
    - 2024: 27.4
    - 2025 (proj.): 28.0
    - 2026 (proj.): 28.2
    - 2027 (proj.): 28.4
    - 2028 (proj.): 28.6
    - 2029 (proj.): 28.7

- Money and credit (annual percent change):
  - Broad money:
    - 2021: 16.4
    - 2022: 8.2
    - 2023: 8.5
    - 2024: 7.9
    - 2025 (proj.): 10.5
    - 2026 (proj.): 11.3
    - 2027 (proj.): 9.0
  - Private sector credit:
    - 2021: 23.6
    - 2022: 18.5
    - 2023: 3.5
    - 2024: 4.0
    - 2025 (proj.): 7.0
    - 2026 (proj.): 10.0
  - Velocity of money:
    - 2021: 1.1
    - 2022: 1.0

- Public finance (in percent of GDP):
  - Revenue:
    - 2021: 15.8
    - 2022: 18.1
    - 2023: 15.9
    - 2024: 14.9
    - 2025 (proj.): 15.0
    - 2026 (proj.): 15.1
    - 2027 (proj.): 15.2
  - Domestic revenue:
    - 2021: 14.7
    - 2022: 13.7
    - 2023: 13.8
    - 2024: 14.0
    - 2025 (proj.): 14.1
    - 2026 (proj.): 14.4
  - Of which: Tax revenue:
    - 2021: 13.2
    - 2022: 13.0
    - 2023: 12.1
    - 2024: 12.2
    - 2025 (proj.): 12.3
    - 2026 (proj.): 12.7
  - Grants:
    - 2021: 1.7
    - 2022: 1.2
    - 2023: 0.9
  - Expenditure:
    - 2021: 21.0
    - 2022: 18.4
    - 2023: 18.7
    - 2024: 17.9
    - 2025 (proj.): 17.3
    - 2026 (proj.): 17.1
    - 2027 (proj.): 17.2
  - Expense:
    - 2021: 12.8
    - 2022: 12.9
    - 2023: 13.3
    - 2024: 13.4
  - Net lending (+)/borrowing(-):
    - 2021: -5.2
    - 2022: -0.3
    - 2023: -2.8
    - 2024: -3.0
    - 2025 (proj.): -2.4
    - 2026 (proj.): -2.2
    - 2027 (proj.): -2.1
    - 2028 (proj.): -2.0
  - Net lending (+)/borrowing(-) excluding grants:
    - 2021: -6.3
    - 2022: -4.0
    - 2023: -4.2
    - 2024: -3.6
    - 2025 (proj.): -3.3
    - 2026 (proj.): -3.2

- Total public debt (in percent of GDP):
  - 2021: 25.9
  - 2022: 25.0
  - 2023: 25.7
  - 2024: 26.8
  - 2025 (proj.): 27.8
  - 2026 (proj.): 27.7

- Balance of payments (millions of dollars):
  - Exports, f.o.b.:
    - 2021: 19,527
    - 2022: 23,175
    - 2023: 23,569
    - 2024: 26,745
    - 2025 (proj.): 28,595
    - 2026 (proj.): 30,942
    - 2027 (proj.): 33,449
    - 2028 (proj.): 36,307
    - 2029 (proj.): 39,457
    - Annual percent change (selected): 2021: 5.7; 2022: 13.5; 2023: 6.9; 2024: 8.7
  - Imports, f.o.b.:
    - 2021: -30,726
    - 2022: -31,995
    - 2023: -26,553
    - 2024: -31,055
    - 2025 (proj.): -33,244
    - 2026 (proj.): -35,626
    - 2027 (proj.): -38,605
    - 2028 (proj.): -41,871
    - 2029 (proj.): -45,434
    - Annual percent change (selected): 2021: 46.4; 2022: -17.0; 2023: 17.0; 2024: 7.2; 2025 (proj.): 8.4
  - Current account (including official transfers) (millions of dollars):
    - 2021: -10,886
    - 2022: -7,572
    - 2023: 555
    - 2024: -847
    - 2025 (proj.): -1,269
    - 2026 (proj.): -1,794
    - 2027 (proj.): -1,993
    - 2028 (proj.): -2,175
    - 2029 (proj.): -2,283
    - Current account (in percent of GDP): 2021: -29.6; 2022: -19.0; 2023: 1.3; 2024: -1.8; 2025 (proj.): -2.5; 2026 (proj.): -3.4
  - Gross official reserves:
    - 2021: 20,265
    - 2022: 17,805
    - 2023: 19,998
    - 2024: 20,753
    - 2025 (proj.): 23,064
    - 2026 (proj.): 26,887
    - 2027 (proj.): 30,951
    - 2028 (proj.): 35,422
    - 2029 (proj.): 40,351
    - In months of prospective imports (selected): 2021: 7.3; 2022: 7.4; 2023: 8.3
  - Total public debt (in millions of dollars):
    - 2021: 9,505
    - 2022: 9,971
    - 2023: 11,187
    - 2024: 12,473
    - 2025 (proj.): 13,932
    - 2026 (proj.): 15,218
    - 2027 (proj.): 16,508
    - 2028 (proj.): 17,912
    - 2029 (proj.): 19,453
  - Public external debt (in millions of dollars):
    - 2021: 12,387
    - 2022: 13,726
    - 2023: 14,939
    - 2024: 16,178
    - 2025 (proj.): 17,548
    - 2026 (proj.): 18,978
  - Public debt service (millions of dollars):
    - 2021: 397
    - 2022: 427
    - 2023: 449
    - 2024: 418
    - 2025 (proj.): 439
    - 2026 (proj.): 458
    - 2027 (proj.): 482
    - 2028 (proj.): 506
    - 2029 (proj.): 533
    - In percent of exports of goods and services (selected): 2021: 2.0

- Memorandum items:
  - Nominal GDP (in billions of Riels):
    - 2021: 150,793
    - 2022: 164,059
    - 2023: 177,719
    - 2024: 190,603
    - 2025 (proj.): 205,946
    - 2026 (proj.): 225,291
    - 2027 (proj.): 245,726
    - 2028 (proj.): 267,845
    - 2029 (proj.): 292,066
  - Nominal GDP (in millions of U.S. dollars):
    - 2021: 36,797
    - 2022: 39,838
    - 2023: 43,304
    - 2024: 46,568
    - 2025 (proj.): 50,180
    - 2026 (proj.): 54,745
    - 2027 (proj.): 59,548
    - 2028 (proj.): 64,733
    - 2029 (proj.): 70,395

*Source: IMF Executive Board press release: IMF Executive Board Concludes 2024 Article IV Consultation with Cambodia.*

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## References

- [https://www.imf.org/-/media/images/imf/bios/imfboard.jpg](https://www.imf.org/-/media/images/imf/bios/imfboard.jpg)
- [The Executive Board](https://www.imf.org/external/np/sec/memdir/eds.aspx)
- [Cambodia and the IMF](http://www.imf.org/external/country/KHM/index.htm)
- [IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance)
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- [PRESS CENTER](http://presscenter.imf.org/)
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_Source: https://www.imf.org/en/news/articles/2025/01/27/pr-25017-cambodia-imf-executive-board-concludes-2024-article-iv-consultation-with-cambodia_