Oxford Economics has stated that the COVID-19 pandemic will have a significant impact on the exports of CLMV countries, comprising Cambodia, Laos, Myanmar and Vietnam.
It added that up to 66 percent of Cambodia’s exports are generated by the clothing and apparel industry which has traditionally benefitted from foreign direct investments and preferential trade benefits main buyers.
It forecasted that FDI inflows will fall sharply this year and that the recovery in 2021 will be muted amid weak global demand for apparel and the partial withdrawal from the “Everything but Arms” scheme with the EU which took effect on August 12.
Although FDI into the garment sectors continued to flow into Cambodia, the number of jobs created is not keeping pace with the number of jobs displaced.
Oxford Economics further stressed that despite this doom and gloom scenario, the CMLV bloc is still tipped to turn in stronger growth than the ASEAN-5 economies – Indonesia, Malaysia, the Philippines, Singapore, and Thailand.
Oxford Economics predicted that CMLV economic growth is likely to average 5.1 percent from 2020 to 2028, outpacing the ASEAN-5’s estimated average of 4 percent. VNA