PHNOM PENH: Cambodia is among a handful of ASEAN’s emerging markets and developing economies expected to post a current account surplus this year, the International Monetary Fund (IMF) says.
In forecasts for Cambodia in its World Economic Outlook released last week, the IMF projected a relatively rare current account surplus of 2.3 percent of GDP for this year, reversing a deficit of 1.7 percent last year.
Cambodia’s surplus is, however, forecast to fall to 1.1 percent of GDP next year. That compares with deficits of between 2.5 and almost 30 percent since 2017.
The current account balance measures trade in goods and services along with other financial transfers such as worker remittances and foreign aid. A surplus can reflect a high rate of national savings compared to investment.
In the IMF data released last week, Singapore — considered an advanced economy — is forecast to have the biggest surplus (17.2 percent of GDP).
Among the other ASEAN economies, Brunei ranks next (15.4 percent) followed by Vietnam (3.2 percent), Cambodia (2.3 percent), Malaysia (1.6 percent) and Thailand (1.2 percent).
The Philippines is forecast to suffer the biggest deficit among ASEAN economies (3.4 percent) followed by Myanmar (2.4 percent), Indonesia (1.5 percent) and Laos (0.1 percent).
Among the other five members of the Regional Comprehensive Economic Partnership, South Korea is forecast to record the biggest current account surplus (3.5 percent of GDP) followed by Japan (3.4 percent) and China (1.9 percent).
New Zealand is projected to suffer the biggest deficit (4.9 percent) followed by Australia (3.1 percent).
On a global basis, the IMF’s outlook said current account balances — the sums of absolute surpluses and deficits — were expected to shrink over the coming five years.
“The widening of current account balances in 2024 reflected widening domestic imbalances and a pickup in global goods trade,” it said.
“Over the medium term, global balances are expected to narrow gradually as the effects of these factors wane.”