ADB: Revised forecast says economy to contract 4%

The Asian Development Bank (ADB) has revised its 2020 growth forecast, predicting Cambodia’s economy will contract 4 percent, from its previous prediction of a 5.4 percent contraction in June, because of improved agricultural performance and increased volume of non-garment manufacturing.

It added that it expects the local economy to rebound to grow 5.9 percent in 2021. However, it stated  this prediction was “very uncertain” and could drastically change owing to a range of factors such as a widespread COVID-19 outbreak in the country. It also projected that inflation would remain relatively stable at 2.1 percent in 2020 before falling to 1.8 percent in 2021, because low oil prices keep transport and production costs down.

The development bank did not re-evaluate its July prediction that Cambodia would lose 390,000 jobs this year. Overall, Southeast Asia is expected to contract by 3.8 percent this year, its first contraction in six decades, before an expected rebound of 6.8 percent growth in 2021.

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