ADB Lowers Cambodia's 2026 Growth Forecast, but Projects 4.7% by 2027

The Asian Development Bank (ADB) has lowered its economic growth forecast for Cambodia to 3.9% for 2026, down from its previous projection of 4.1% in July. This adjustment reflects weaker-than-expected activity in the tourism and related services sectors. Despite this revision, the ADB projects Cambodia's economy to rebound and grow to 4.7% in 2027. Yasmin Siddiqi, ADB Country Director for Cambodia, stated that the Cambodian economy continues to show resilience. She further explained that the robust growth in manufacturing exports and the sustained inflow of foreign direct investment are helping to offset the challenges faced in the tourism sector. Siddiqi emphasized the importance of ongoing efforts in diversifying the economy, enhancing competitiveness, supporting vulnerable households, and strengthening climate resilience for sustained inclusive growth. Cambodia's economy has experienced robust growth in recent years, supported by significant investment from China and its competitive manufacturing cost structure within the ASEAN region. Labor-intensive industries like garments and footwear have been key export drivers. However, the tourism sector was severely impacted by the COVID-19 pandemic, and its slow recovery continues to cast a shadow over overall economic expansion. The ADB's forecast suggests a balance between these short-term challenges and long-term growth drivers.