By most measurements, the Cambodian economy is healthy. The Asian Development Bank forecasts economic growth of 7% in 2019 and 6.8% for 2020, while the World Bank considers economic growth to be “better than expected” because of increasing exports, growing internal demand, and consistency in foreign investment. But structural problems persist. Cambodia is repeatedly ranked as one of the worst countries in Southeast Asia for corruption. Money laundering remains rife, especially in the gaming and property sectors. The global money-laundering watchdog Financial Action Task Force (FAFT) put Cambodia on its list of countries “highly vulnerable to money laundering” in February. Meanwhile, almost all international financial institutions recommend faster diversification away from low-cost, low-skilled manufacturing, and for Cambodia to carve a niche in high-skilled assembly before others nations in Southeast Asia, namely Thailand and Vietnam, dominate certain industries.
Cambodia: Risk Update