Development, Stability & Digital Finance

World Finance: What’s the outlook for development and inflation for the rest of 2025?

Chea Serey: Cambodia’s financial system is projected to develop round 5% in 2025 primarily based on the federal government’s newest projection. Throughout the first seven months, financial development expanded robustly, though uneven throughout sectors. Garment exports surged 21.3% resulting from front-loading orders forward of US tariffs, whereas non-garment exports rose 14%, benefiting from diversification insurance policies, however this momentum might ease later this 12 months. Concurrently, tourism recovered steadily earlier than the Cambodia-Thailand border battle, although modest development is anticipated going ahead.

Inflation is forecast at 2.4% in 2025, pushed by the softening of oil and meals costs. Regardless of the border closure disrupting Cambodia-Thailand commerce, the impression on inflation has been marginal. Value stability can be attributed to the steady change charge.

GF: The second and third sub-programs of the “Inclusive and Sustainable Monetary Improvement Program” run till 2029. How will they impact change in Cambodia’s monetary system?

Serey: The second and third sub-programs will strengthen Cambodia’s monetary system by bettering stability, increasing entry, and supporting sustainable development. We’re specializing in monetary literacy, shopper safety, and wider entry to digital and non-bank providers—particularly for ladies and underserved teams. On the similar time, we’re introducing sustainable finance instruments and enhancing oversight to make sure long-term resilience. New monetary merchandise and market developments will assist channel funding, improve liquidity, and promote use of the riel. These reforms are key to constructing a contemporary, inclusive, and sustainable monetary system for Cambodia’s future.

GF: How has using the Bakong altered Cambodia’s monetary panorama?

Serey: Launched in October 2020, the blockchain-based Bakong system has remodeled Cambodia’s monetary sector by addressing cost platform interoperability, selling monetary inclusion, enhancing effectivity in cost techniques, and strengthening cost in native forex. By July 2025, it had 70 banking and monetary member establishments, reaching over 34 million accounts. As of 2024, Bakong processed 600 million transactions price $147 billion, some 3 times the worth of Cambodia’s GDP. The Nationwide Financial institution of Cambodia (NBC) continues its efforts to advertise the utilization of the Bakong system by partnering with regional international locations like Malaysia, Thailand, Vietnam, Lao PDR, Korea, China, in addition to Japan, and facilitating handy digital funds for vacationers by way of the brand new Bakong Vacationers App.

GF: Is the specter of debt misery when the forbearance regime is lifted in December of nice concern?

Serey: To ease debt burdens, mortgage restructuring has been offered to weak teams and companies impacted by the Covid-19 pandemic and ongoing border battle. Non-performing loans (NPL) reached 8% as of Q2 2025; this quantity is partly as a result of sharp slowdown in credit score development to 2% when confronted with world and inside uncertainties. The NBC is monitoring intently the sufficient provisioning and the general efficiency of monetary establishments due to this excessive NPL. On the systemic degree, monetary establishments’ capital adequacy ratios stay sturdy with ample liquidity. The NBC will proceed to observe debt overhang and preserve flexibility in its macroprudential insurance policies. It’s particularly necessary for us to be a powerful guardian of monetary stability and help financial exercise throughout difficult and unsure occasions like proper now.