Cambodia Maintains Lower-Middle Income Status Amid Regional Upgrades

The World Bank, in its latest country income classifications released on July 1, moved Vietnam from the lower-middle-income to the upper-middle-income group. This upgrade is based on Vietnam's gross national income (GNI) per capita reaching $4,970 in 2025, surpassing the World Bank's threshold of $4,516. The evaluations, based on each country's GNI per capita from the previous year and measured in US dollars adjusted for exchange rate fluctuations, categorize economies into four groups: low, lower-middle, upper-middle, and high income. According to the World Bank, Vietnam's income upgrade was driven by its 'export-led' economic model, with exports surging over 15 percent in both 2024 and 2025, and GDP growing at 7 and 8 percent, respectively. Alongside Vietnam, Jordan, Micronesia, the Philippines, and Sri Lanka also moved from lower-middle to upper-middle income status. Togo, a West African nation, transitioned from low to lower-middle income. The World Bank highlighted that these classifications are crucial for determining which countries can access concessional loans and development assistance. However, the current reclassifications do not affect the World Bank's existing lending policies, as Vietnam and the Philippines continue to borrow from the International Bank for Reconstruction and Development (IBRD), and Sri Lanka from the International Development Association (IDA). Cambodia was not specifically mentioned in this classification update. However, the economic progress of neighboring countries and the region as a whole offers context for Cambodia's own development trajectory, particularly in relation to its economic policies and external relations, notably with China. Cambodia has been actively pursuing infrastructure development and attracting foreign investment in recent years, aiming to enhance its economic standing in Southeast Asia.