Macroeconomic Forecast Cambodia
October 2005 | Macroeconomic ForecastsIf you would like to subscribe to South East Asia Monitor Vol 1 and gain instant access to this article, please click here to subscribe.
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BMI is forecasting real GDP growth of 4.0% in 2005 compared with 5.5% growth last year. The IMF recently revised its 2005 GDP growth forecast upwards to 5-6% from 2.5% previously. The main reason for the change was the apparent resilience of the garment sector despite the ending of the international textile quotas under the Agreement of Textiles and Clothing (ATC) at the end of 2004. In actual fact, developments in the garments sector are more mixed than the IMF implies, but in general the sector has not experienced the devastation some had predicted. The IMF also said that another reason it had raised its growth forecast for 2005 was because of the improved outlook for agriculture following an easing of the drought. However, after facing a severe water shortage, some parts of the country have now seen flooding. Consequently the rice harvest is likely to be below potential.