Washington, DC: On November 21, 2025, the Executive Board of the International Monetary Fund (IMF) completed the Article IV Consultation for Cambodia. The authorities have consented to the publication of the Staff Report prepared for this consultation.
According to International Monetary Fund, Cambodia's economy showed notable growth in 2024, with a 6.0 percent increase driven by strong performance in garment and agricultural exports, coupled with a recovery in tourism. However, signs of an economic slowdown are emerging in the second half of 2025 due to trade disruptions, border tensions, and weak credit growth. Growth is projected to decrease to 4.8 percent in 2025 and further to around 4.0 percent in 2026, mainly due to export volatility, declining remittances, and a slowdown in tourism impacting domestic demand.
The IMF highlighted that risks are predominantly on the downside, with financial sector vulnerabilities being central. Trade policy uncertainty and renewed border tensions could exacerbate these risks, affecting export growth and domestic confidence. There is also concern over private debt levels, rising non-performing loans, and governance issues posing threats to financial stability. Nonetheless, regional trade and investment integration could support export growth, and reintegrating returning workers into the domestic labor market could strengthen domestic demand recovery.
Executive Directors of the IMF agreed with the staff appraisal, noting that Cambodia's economic growth, although strong in 2024, is showing signs of deceleration. They emphasized the importance of maintaining macroeconomic stability through coordinated fiscal, monetary, and structural policies. Directors recommended that fiscal policies should cushion current shocks while maintaining fiscal prudence, and monetary policies should remain agile and responsive to changing conditions.
They also stressed the need for financial sector policies to manage rising risks and called for enhanced supervisory capacity and reforms to insolvency and crisis management frameworks. Structural reforms to diversify exports, improve productivity, and enhance trade facilitation were underscored as critical. Additionally, governance reforms are deemed essential to improve the business environment and ensure sustainable development.