Cambodia received more than 5 billion dollars in foreign direct investment in 2025, helping to stabilise the economy and create an estimated 400,000 decent jobs, according to a World Bank team in Cambodia.

But in a forecast report released on June 9, the World Bank said Cambodia’s economy is facing pressure from several factors, including higher fuel prices, rising inflation, and a slowdown in construction.

The report said inflation reached nearly 6 percent in April, increasing the cost of everyday goods and placing particular pressure on low-income families.

It said a 10 percent rise in fuel prices could increase poverty by 1.4 percent, while a decline in housing and building construction is also weighing on growth.

The World Bank projected that Cambodia’s gross domestic product growth would remain subdued at an average of 3.9 percent in 2026, before recovering to 4.9 percent in 2027.

The slowdown is also being partly linked to the return of about half a million Cambodian migrant workers from Thailand. Their return has reduced the amount of money being sent back to Cambodia from workers overseas.

The World Bank advised the Cambodian government to adopt a broad policy response to deal with the economic pressures.

It said the government should focus on protecting people’s livelihoods, creating jobs, carrying out structural reforms, improving governance, and increasing productivity.

It also recommended measures such as reducing fuel taxes, ensuring the timely import of fertiliser for farmers, and increasing domestic revenue to support health, education, and social services.

The report said the overall aim should be to help Cambodian citizens maintain enough income to support their daily living costs.