PHNOM PENH: The World Bank expects Cambodia and the Philippines to be the fastest-growing developing ASEAN economies this year.
But it has offered a mixed outlook for the post-Covid tourism recoveries in Cambodia and Thailand.
In its Global Economic Prospects for 2024 released this week, the bank said slower-than-expected growth in China would have “negative spillovers to demand and activity” across East Asia and the Pacific.
“Slower manufacturing growth in China would depress regional processing trade,” it said.
‘DAMPENED DEMAND FOR INTERNATIONAL TRAVEL’
“Weaker discretionary household spending in China would also spill over to the region, including through dampened demand for international travel, curtailing the tourism recovery in some of the region’s economies, including Cambodia and Thailand.”
At the same time, the bank expects “soft domestic demand in China, where continued property sector weakness is expected to weigh on global commodities demand, with adverse spillovers to the region’s commodity exporters.”
‘REVIVAL IN OUTBOUND TOURISM FROM CHINA’
“In contrast, international tourism in the region is envisaged to largely recover from the pandemic in 2024, supported by a continued revival in outbound tourism from China.
“This will support services exports, particularly in tourism-reliant economies like Cambodia and Thailand.”
In its latest projections — updated from June last year — the bank forecasts 5.8 percent growth for Cambodia and the Philippines this year and 5.5 percent for Vietnam.
Other developing ASEAN economies are seen growing at a slower pace — 4.9 percent in Indonesia, 4.3 percent in Malaysia, 4.1 percent in Laos, 3.2 percent in Thailand, and 2.0 percent in Myanmar.
For 2025, Cambodia is projected to be Southeast Asia’s fastest-growing developing economy at 6.1 percent along with Vietnam at 6.0 percent with the Philippines falling to third place at 5.8 percent.
Slower growth is forecast for Indonesia at 4.9 percent, Laos at 4.3 percent, Malaysia at 4.2 percent and Thailand at 3.1 percent. No forecast for Myanmar in 2025 was available.
Compared with the projections in June last year, Cambodia’s latest forecasts have been revised downwards by 0.3 percentage points for 2024 and 0.2 points for 2025.
The bank said China’s economy was projected to expand by 4.5 percent this year and 4.3 percent next year, both down 0.1 point from the June forecasts.