PHNOM PENH, May 10 (Xinhua) -- Economic growth in Cambodia remains robust and is projected to accelerate slightly to 6.9 percent in 2018, compared with 6.8 percent in 2017, buoyed by a rebound in textile and apparel exports as well as tourism and agriculture, says a new World Bank report on Thursday.
Rising government spending and favorable global conditions, including robust demand in advanced economies, are expected to underpin Cambodia's high growth trajectory, said the bank's latest Cambodia Economic Update.
Risks remain, however, and they include erosion of export competitiveness due to rapidly rising real wages, a buildup of vulnerabilities from a prolonged real estate and construction boom, potential election-related uncertainty, and periodic jolts of protectionism and escalating trade disputes between the world's largest trading nations.
"To maintain strong growth, it is essential that Cambodia invests more in education and skills training while addressing the constraints facing small and medium businesses," Inguna Dobraja, World Bank country manager for Cambodia, said in a press release.
"Investing in people is the best for a more prosperous future," she said.
The report also recommends Cambodia to closely monitor the construction and real estate boom by developing macro-prudential policies that help reduce the scope for speculative activities.
Tourist arrivals accelerated to 11.8 percent in 2017, compared with 5 percent in 2016, thanks to the authorities' efforts to establish more regional flights, including to China, an important market for tourism, the report said.
The agriculture sector also rebounded, with expansion of rice and rubber plantations and the gradual recovery of agricultural commodity prices.