Cambodia’s current account deficit shrank to 1.9 percent of gross domestic product (GDP), or 616 billion riel (approximately $149 million), in the first quarter of 2023 from a deficit of 7,800 billion riel ($1.9 billion) in the corresponding period last year.
The sharp decline was due to a contraction in the deficit of balance on goods coupled with the rise in the surplus of services account (driven by the exports of services), the National Bank of Cambodia (NBC)’s Balance of Payments Statistical Bulletin said as at end-June.
It indicates a growth in the export of goods, although the balance of goods remains in deficit.
For instance, goods exports rose 1.8 percent to 22.1 trillion riel in the first quarter of 2023 from the fourth quarter of 2022, on the back of textiles and agricultural products, although exports of garment, footwear, bicycle and electrical parts declined.
Imports of goods fell 7.5 percent to 26.1 trillion riel from the previous quarter as demand for garment materials, food and beverage, vehicles, construction materials and equipment. Petroleum imports increased by 45.4 percent during that period.
In a latest post on X (formerly Twitter), NBC showed that income from receipts or payments under Cambodia’s secondary income registered a surplus of 3,366 billion riel, which represented 10.2 percent of GDP.
Meanwhile, balance of payment recorded a deficit of 324 billion riel in the quarter under review, or one percent of GDP, compared to a surplus of 1,645 billion riel a year ago.
But the account balance has been recording a deficit in the last two quarters as the net incurrence of liabilities of the financial account failed to offset the deficit of current and capital accounts.
That being said, Cambodia’s current and capital accounts recorded a significantly lower deficit of 1.4 percent of GDP, or 474 billion riel, as opposed to 7,586 billion riel in the first quarter of 2022 because of the smaller deficit in balance of goods and services.