How will COVID-19 Affect Cambodia’s economy?

While the economic impact of the outbreak will be felt globally, tourism-dependent economies like Cambodia will be hit hardest. Photo by Ghy Dana/ThmeyThmey

The Asian Development Bank maps out economic impacts of various scenarios as the coronavirus spreads to over 70 countries.



PHNOM PENH--The Asian Development Bank’s (ADB) recent analysis predicts that the coronavirus outbreak could cost the global economy between $77 billion and $347 billion, equivalent to 0.1 – 0.4 percent loss of gross domestic product (GDP).



Based on a range of scenarios, the analysis illustrates the best, moderate and worst case scenario of economic impacts from the virus. However, the brief stressed that the “economic impact will depend on how the outbreak evolves, which remains highly uncertain.”  



Tourism-dependent economies, such as Cambodia “will likely see a significant decline in tourism revenues,” according to the brief.  



In fact, the Kingdom’s tourism revenue is estimated to have in a best-case scenario, 1.409 percent loss in GDP, roughly $345.7 million. By contrast a moderate-case scenario would result in a loss of 1.929 percent of GDP, around $473.4 million loss. In the worst case scenario, the ADB estimates that Cambodia could lose up to 3.49 percent of GDP equivalent to $856.5 million.



The brief continued to state that “anecdotal evidence” has demonstrated that tourist arrivals in other Asian economies have dropped by 50-90 percent in February 2020, compared to the same period last year.



Along with tourism, the ADB predicts that investment, domestic consumption in outbreak-affected economies, demand to other sectors, trade and production will be negatively affected due to the outbreak.  



As of March 7, 2020, there have been two confirmed cases of the virus in the Kingdom, with one having recovered. There are still 40 more cases being monitored in Siem Reap, according to the Ministry of Health. 





 


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