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Cambodia vs. Laos

Economy

CambodiaLaos
Economy - overviewCambodia has experienced strong economic growth over the last decade; GDP grew at an average annual rate of over 8% between 2000 and 2010 and at least 7% since 2011. The tourism, garment, construction and real estate, and agriculture sectors accounted for the bulk of growth. Around 600,000 people, the majority of whom are women, are employed in the garment and footwear sector. An additional 500,000 Cambodians are employed in the tourism sector, and a further 50,000 people in construction. Tourism has continued to grow rapidly with foreign arrivals exceeding 2 million per year since 2007 and reaching around 4.5 million visitors in 2014. Mining also is attracting some investor interest and the government has touted opportunities for mining bauxite, gold, iron and gems.

Cambodia remains one of the poorest countries in Asia and long-term economic development remains a daunting challenge, inhibited by endemic corruption, limited human resources, high income inequality, and poor job prospects. As of 2012, approximately 2.66 million people live on less than $1.20 per day, and 37% of Cambodian children under the age of 5 suffer from chronic malnutrition. More than 50% of the population is less than 25 years old. The population lacks education and productive skills, particularly in the impoverished countryside, which also lacks basic infrastructure.

The World Bank in 2016 formally reclassified Cambodia as a lower middle-income country as a result of continued rapid economic growth over the past several years. Cambodia’s graduation from a low-income country will reduce its eligibility for foreign assistance and will challenge the government to seek new sources of financing in 2017. The Cambodian Government has been working with bilateral and multilateral donors, including the Asian Development Bank, the World Bank and IMF, to address the country's many pressing needs; more than 30% of the government budget comes from donor assistance. A major economic challenge for Cambodia over the next decade will be fashioning an economic environment in which the private sector can create enough jobs to handle Cambodia's demographic imbalance.
The government of Laos, one of the few remaining one-party communist states, began decentralizing control and encouraging private enterprise in 1986. Economic growth averaged more than 6% per year from 1988-2008, and Laos' growth has more recently been amongst the fastest in Asia, averaging nearly 8% per year for most of the last decade, but has declined over the past year and is expected to be around 6.8% in 2017, according to the IMF.

Nevertheless, Laos remains a country with an underdeveloped infrastructure, particularly in rural areas. It has a basic, but improving, road system, and limited external and internal land-line telecommunications. Electricity is available to 83% of the population. Agriculture, dominated by rice cultivation in lowland areas, accounts for about 25% of GDP and 73% of total employment. Recently, the country has faced a persistent current account deficit, falling foreign currency reserves, and growing public debt, as slow recovery of the global economy, especially that of China, has driven down the prices of its mineral exports.

Laos' economy is heavily dependent on capital-intensive natural resource exports. The economy has benefited from high-profile foreign direct investment in hydropower dams along the Mekong River, copper and gold mining, logging, and construction, although some projects in these industries have drawn criticism for their environmental impacts.

Laos gained Normal Trade Relations status with the US in 2004 and applied for Generalized System of Preferences trade benefits in 2013 after being admitted to the World Trade Organization earlier in the year. Laos held the chairmanship of ASEAN in 2016. Laos is in the process of implementing a value-added tax system. The government appears committed to raising the country's profile among foreign investors and has developed special economic zones replete with generous tax incentives, but a limited labor pool, a small domestic market, and corruption remain impediments to investment. Laos also has ongoing problems with the business environment, including onerous registration requirements, a gap between legislation and implementation, and unclear or conflicting regulations.
GDP (purchasing power parity)$58.94 billion (2016 est.)
$55.09 billion (2015 est.)
$51.47 billion (2014 est.)
note: data are in 2016 dollars
$40.96 billion (2016 est.)
$38.11 billion (2015 est.)
$35.43 billion (2014 est.)
note: data are in 2016 dollars
GDP - real growth rate7% (2016 est.)
7% (2015 est.)
7.1% (2014 est.)
7.5% (2016 est.)
7.6% (2015 est.)
7.5% (2014 est.)
GDP - per capita (PPP)$3,700 (2016 est.)
$3,500 (2015 est.)
$3,400 (2014 est.)
note: data are in 2016 dollars
$5,700 (2016 est.)
$5,400 (2015 est.)
$5,100 (2014 est.)
note: data are in 2016 dollars
GDP - composition by sectoragriculture: 26.7%
industry: 29.8%
services: 43.5% (2016 est.)
agriculture: 21.3%
industry: 32.5%
services: 39.4% (2016 est.)
Population below poverty line17.7% (2012 est.)
22% (2013 est.)
Household income or consumption by percentage sharelowest 10%: 2%
highest 10%: 28% (2013 est.)
lowest 10%: 3.3%
highest 10%: 30.3% (2008)
Inflation rate (consumer prices)2.8% (2016 est.)
1.2% (2015 est.)
0.7% (2016 est.)
1.3% (2015 est.)
Labor force6.643 million (2016 est.)
3.5 million (2016 est.)
Labor force - by occupationagriculture: 48.7%
industry: 19.9%
services: 31.5% (2013 est.)
agriculture: 73.1%
industry: 6.1%
services: 20.6% (2012 est.)
Unemployment rate0.3% (2013 est.)
0.2% (2012 est.)
note: according to official statistics; underemployment is high
1.3% (2012 est.)
1.4% (2014 est.)
Distribution of family income - Gini index37.9 (2008 est.)
41.9 (2004 est.)
36.7 (2008)
34.6 (2002)
Budgetrevenues: $3.388 billion
expenditures: $3.562 billion (2016 est.)
revenues: $2.882 billion
expenditures: $3.822 billion (2016 est.)
Industriestourism, garments, construction, rice milling, fishing, wood and wood products, rubber, cement, gem mining, textiles
mining (copper, tin, gold, gypsum); timber, electric power, agricultural processing, rubber, construction, garments, cement, tourism
Industrial production growth rate8.3% (2016 est.)
8% (2016 est.)
Agriculture - productsrice, rubber, corn, vegetables, cashews, cassava (manioc, tapioca), silk
sweet potatoes, vegetables, corn, coffee, sugarcane, tobacco, cotton, tea, peanuts, rice; cassava (manioc, tapioca), water buffalo, pigs, cattle, poultry
Exports$8.762 billion (2016 est.)
$8.453 billion (2015 est.)
$3.075 billion (2016 est.)
$2.928 billion (2015 est.)
Exports - commoditiesclothing, timber, rubber, rice, fish, tobacco, footwear
wood products, coffee, electricity, tin, copper, gold, cassava
Exports - partnersUS 23%, UK 8.7%, Germany 8.2%, Japan 7.4%, Canada 6.7%, China 5.1%, Vietnam 5%, Thailand 4.9%, Netherlands 4% (2015)
Thailand 30.4%, China 26.9%, Vietnam 17.5% (2015)
Imports$12.32 billion (2016 est.)
$11.92 billion (2015 est.)
$3.936 billion (2016 est.)
$4.058 billion (2015 est.)
Imports - commoditiespetroleum products, cigarettes, gold, construction materials, machinery, motor vehicles, pharmaceutical products
machinery and equipment, vehicles, fuel, consumer goods
Imports - partnersThailand 28.7%, China 22.2%, Vietnam 16.4%, Hong Kong 6.1%, Singapore 5.7% (2015)
Thailand 60.9%, China 18.6%, Vietnam 7.3% (2015)
Debt - external$8.46 billion (31 December 2016 est.)
$7.483 billion (31 December 2015 est.)
$11.98 billion (31 December 2016 est.)
$10.77 billion (31 December 2015 est.)
Exchange ratesriels (KHR) per US dollar -
4,066 (2016 est.)
4,067.8 (2015 est.)
4,067.8 (2014 est.)
4,037.5 (2013 est.)
4,033 (2012 est.)
kips (LAK) per US dollar -
8,190.2 (2016 est.)
8,147.9 (2015 est.)
8,147.9 (2014 est.)
8,049 (2013 est.)
8,007.3 (2012 est.)
Fiscal yearcalendar year
1 October - 30 September
Public debt33.9% of GDP (2014 est.)
33.4% of GDP (2013 est.)
61.6% of GDP (2016 est.)
61.7% of GDP (2015 est.)
Reserves of foreign exchange and gold$8.477 billion (31 December 2016 est.)
$7.376 billion (31 December 2015 est.)
$1.024 billion (31 December 2016 est.)
$1.058 billion (31 December 2015 est.)
Current Account Balance-$1.678 billion (2016 est.)
-$1.886 billion (2015 est.)
-$2.35 billion (2016 est.)
-$2.114 billion (2015 est.)
GDP (official exchange rate)$19.37 billion (2016 est.)
$13.76 billion (2016 est.)
Stock of direct foreign investment - at home$29.17 billion (2014 est.)
$15.14 billion (31 December 2012 est.)
$12.44 billion (31 December 2011 est.)
Market value of publicly traded shares$NA
$1.012 billion (2012 est.)
$576.8 million (2011 est.)
Central bank discount rateNA% (31 December 2012)
5.25% (31 December 2007)
4.3% (31 December 2010)
4% (31 December 2009)
Commercial bank prime lending rate11.8% (31 December 2016 est.)
11.71% (31 December 2015 est.)
16.5% (31 December 2016 est.)
18.2% (31 December 2015 est.)
Stock of domestic credit$11.72 billion (31 December 2016 est.)
$9.776 billion (31 December 2015 est.)
$8.135 billion (31 December 2016 est.)
$7.231 billion (31 December 2015 est.)
Stock of narrow money$1.785 billion (31 December 2016 est.)
$1.602 billion (31 December 2015 est.)
$1.161 billion (31 December 2016 est.)
$1.132 billion (31 December 2015 est.)
Stock of broad money$14.38 billion (31 December 2016 est.)
$12.12 billion (31 December 2015 est.)
$7.782 billion (31 December 2016 est.)
$7.196 billion (31 December 2015 est.)
Taxes and other revenues17.5% of GDP (2016 est.)
20.9% of GDP (2016 est.)
Budget surplus (+) or deficit (-)-0.9% of GDP (2016 est.)
-6.8% of GDP (2016 est.)
GDP - composition, by end usehousehold consumption: 78.5%
government consumption: 5.4%
investment in fixed capital: 21%
investment in inventories: 1.6%
exports of goods and services: 64.7%
imports of goods and services: -71.2% (2016 est.)
household consumption: 62.6%
government consumption: 14.1%
investment in fixed capital: 33.1%
investment in inventories: 1%
exports of goods and services: 47.2%
imports of goods and services: -58% (2016 est.)
Gross national saving12.7% of GDP (2016 est.)
11.8% of GDP (2015 est.)
11.1% of GDP (2014 est.)
25% of GDP (2016 est.)
20% of GDP (2015 est.)
25.8% of GDP (2014 est.)

Source: CIA Factbook