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Cambodia on verge of transitioning from low-income to middle-income country: ADB chief

Xinhua, March 10, 2015 Adjust font size:

Asian Development Bank (ADB) President Takehiko Nakao said here Tuesday that Cambodia is on the verge of transforming from a low-income to a middle-income country.

"Cambodia is among the world's fastest-growing economies," he said in a press conference. "The country's rapid economic growth-- driven by strong gains in industry, services and agriculture--has brought Cambodia to the verge of transitioning from a low-income to a middle-income country."

The middle-income nation is defined by the GDP (gross domestic product) per capita between 1,045 U.S. dollars and 12,746 U.S. dollars, according to a World Bank's classification.

Nakao said the Southeast Asian nation has rapidly reduced poverty from nearly 50 percent of the population in 2007 to just 19 percent in 2012, although many people have moved only slightly above the poverty line and remain vulnerable.

Cambodia's GDP expanded at an average annual rate of 6.5 percent between 2007 and 2014. He said ADB predicts the country's growth of 7.3 percent in 2015, underpinned by well-managed inflation, a stable exchange rate and sustained competitiveness.

"However, the economy is vulnerable to external price and demand shocks due to dependence on sectors such as garments-- which comprised 71 percent of exports in 2013--despite recent success in producing more sophisticated products such as electronic components," he said.

Meanwhile, he said ADB would continue supporting Cambodia to ensure the country's sustainable economic growth and poverty reduction.

ADB resumed operations in Cambodia in 1992 following two decades of conflict, and has since delivered 2.11 billion U.S. dollars in loans, grants and technical assistance, according to its press release. The lender is supporting Cambodia with 800 million U.S. dollars in assistance between 2014 and 2018.

Nakao started a two-day visit to Cambodia on Tuesday. Earlier in the day, he met with Prime Minister Hun Sen. Endi