IMF Forecasts 4.2% Growth for Cambodia This Year, 6.0% Next Year

The International Monetary Fund (IMF) has forecast Cambodia’s GDP growth to accelerate from 4.2 percent this year to 6.0 percent in 2022, which would put the country among the fastest growing ASEAN economies next year.

In its World Economic Outlook released in Washington Tuesday, the IMF also projected that Cambodia would have the region’s most rapidly growing economy by 2026.

Under the impact of the COVID-19 pandemic, the IMF said Cambodia’s GDP shrank 3.5 percent last year.

That was not as steep as the contractions suffered in the Philippines (9.5 percent), Thailand (6.1 percent), Malaysia (5.6 percent) and Singapore (5.4 percent).

Compared with Cambodia, Indonesia’s economy shrank less (2.1 percent), as did the Lao economy (0.4 percent).

The IMF said only three ASEAN economies expanded last year led by Myanmar (3.2 percent), Vietnam (2.9 percent) and Brunei (1.2 percent).

For 2021, Cambodia’s GDP growth forecast is higher than for Thailand (2.6 percent) and Brunei (1.6 percent) and compares with a forecast for a steep downturn in Myanmar with its economy contracting by 8.9 percent.

Six ASEAN economies are forecast to expand faster than Cambodia, led by the Philippines (6.9 percent) followed by Malaysia and Vietnam (6.5 percent), Singapore (5.2 percent), Laos (4.6 percent) and Indonesia (4.3 percent).

By 2022, however, Cambodia is forecast to be among the region’s fastest growing economies — in equal third place with Malaysia with 6.0 percent growth after Vietnam (7.2 percent) and the Philippines (6.5 percent).

Slower growth is forecast for Indonesia (5.8 percent), Laos and Thailand (5.6 percent), Singapore (3.2 percent), Brunei (2.5 percent) and Myanmar (1.4 percent).

In its medium-term forecast, the IMF projected that Cambodia would have the region’s fastest growth with the economy expanding by 6.8 percent in 2026.

The IMF also projected robust medium-term growth in Vietnam (6.6 percent), the Philippines (6.5 percent) and Laos (6.0 percent).

Slower growth is projected for Indonesia (5.2 percent), Myanmar (5.1 percent) and Malaysia (5.0 percent) with even more modest expansions in Thailand (3.6 percent), Singapore (2.5 percent) and Brunei (2.0 percent).

The IMF said the the world economy was forecast to rebound 6.0 percent this year after contracting 3.3 percent last year. But global growth is forecast to moderate to 4.4 percent next year and 3.3 percent by 2026.

“We are now projecting a stronger recovery in 2021 and 2022 for the global economy compared to our previous forecast,” IMF Chief Economist Gita Gopinath said in her foreword to this year’s outlook.

“Nonetheless, the outlook presents daunting challenges related to divergences in the speed of recovery both across and within countries and the potential for persistent economic damage from the crisis,” she said.

At a news conference, Gopinath said upgrades in global growth for 2021 and 2022 were mainly due to upgrades for advanced economies, particularly the United States.

“This makes the United States the only large economy projected to surpass the level of GDP it was forecast to have in 2022 in the absence of this pandemic,” she said.

“Other advanced economies, including the euro area, will also rebound this year but at a slower pace.”

 

Source: Agency Kampuchea Press