Cambodia's Economy May Shrink 1.43% in 2026 Under Energy and Export Shocks: CDRI

PHNOM PENH, Sept 1, 2026 (KPT) — The Cambodia Development Resource Institute (CDRI) has downgraded its outlook, saying the country’s economy could contract by 1.43 percent below baseline in 2026 under a moderate combined scenario of energy‑market disruption and export restrictions. The report, The Economic Impact on Cambodia of International Energy‑Market Disruption, uses an economy‑wide simulation model to assess the effects of higher energy prices and restrictions on fuel and fertiliser exports. Under the scenario, employment could fall 2.97 percent, private consumption 4.81 percent and investment 6.71 percent, while Cambodia’s terms of trade could deteriorate by 4.07 percent. The findings come as the Ministry of Economy and Finance has already revised its 2026 growth forecast to 4.1 percent, down from 5 percent, citing weaker performance in agriculture and tourism amid external and domestic shocks. Officials have cautioned that global tensions, higher energy costs, inflationary pressures and supply‑chain disruptions continue to weigh on investment and trade. CDRI said Cambodia is particularly exposed to energy shocks because it produces no domestic oil and relies on a limited number of regional suppliers. Construction would be among the hardest‑hit sectors, with output projected to decline 6.35 percent and employment 13.65 percent. Agro‑processing could fall 0.62 percent, while agriculture, forestry and fishing could drop 0.47 percent. The study noted that energy‑price shocks would cause most of their damage in 2026 before recovery, while export restrictions could create a more persistent drag through 2031. Some industries could benefit from currency depreciation, with petroleum, coal and chemicals projected to expand 9.75 percent. CDRI stressed that the figures are scenario‑based simulations rather than forecasts, but said they highlight the importance of diversification, energy security and stronger domestic resilience.