Lesson Learned from Covid-19 and Future Research Agenda in Support of Private Sector Development in Cambodia
Cambodia is now on the path to economic recovery with projected GDP growth rates of 5.5 percent in 2023 and 6 percent in 2024. However, as a small, export-dependent economy, Cambodia is more susceptible to external environmental conditions and global economic shocks (UNDP 2022). Particularly, the prolonged COVID-19 pandemic, the Russia-Ukraine war, the China-US trade war, widespread economic sanctions and other chronic conflicts around the globe still negatively affect the Cambodian economy. These negative impacts include supply chain disruptions, oil price explosion, rising inflation, higher interest rates and reduced investment inflows. In this regard, the country’s economic growth will remain sluggish and uncertain in the following years if regional and global economic instability and uncertainty prevail. Thus, Cambodia needs to build and strengthen its solid economic foundation through local business promotion, private sector development and local production to diversify the country’s economy beyond the garment, tourism, construction and agriculture sectors. Towards that end, small and medium enterprises (SMEs) are purportedly the key to the country’s economic development as they dominate the business landscape and are important for employment and income generation, poverty reduction and GDP growth (Chhim and Lay 2021).
With core support from Swedish International Development Cooperation Agency (Sida), CDRI collaborated with the Ministry of Economy and Finance to design and implement original research titled “Strengthening Cambodia’s Post-Pandemic Recovery and Competitiveness Pathways” in 2021. The results from this research provide new, in-depth insights into the country’s socioeconomic development in relation to the COVID-19 context, as well as ongoing global crises. Its primary objective is to provide evidence-based intervention recommendations for policymakers, practitioners and relevant stakeholders that are responsive to socioeconomic issues.
The research conducted by CDRI was disseminated in a workshop on June 7, 2023 that engaged relevant stakeholders from the government, private sector and business associations to delve into two crucial topics: lessons learned from the Covid-19 pandemic for future research agendas and partnerships in support of private sector development in Cambodia. The insights gained from these discussions are expounded upon in the subsequent sections.