In the first two months of 2023, the Ministry of Commerce gathered for its annual meeting. The agenda was straightforward: review what worked in 2022, set targets for the year ahead. On the first day, Minister Pan Sorasak delivered the headline numbers. Cambodia’s foreign trade had hit $52.425 billion last year. That was a 9.19% jump from 2021.
The data came from the General Department of Customs and Excise. It showed a country that had kept trading through a storm. Global inflation. Fuel and food price spikes. The war in Ukraine. COVID-19 disruptions that refused to fully fade. Yet the numbers went up, not down.
Exports led the way. They rose 16.44% to $22.483 billion. Imports grew too, but slower — up 4.32% to $29.942 billion. The trade deficit shrank by a fifth, to $7.459 billion. That narrowing is the kind of detail economists watch. It means the country is selling more relative to what it buys. It means less money flowing out than before.
How did this happen? The minister pointed to in-depth reforms. Better export competitiveness. A more favorable business environment. Those are broad categories. But they rest on concrete decisions made in previous years.
Most critical was the shift on COVID-19. Cambodia moved to an endemic approach in November 2021. That was early by regional standards. The government allowed the full resumption of socio-economic activity then. Throughout 2022, it kept peeling away restrictions that had choked trade and commerce. Businesses could operate normally. Supply chains could recover.
Sorasak tied this directly to vaccination rates. Cambodia’s coronavirus vaccination coverage was among the highest in the region. That gave the government room to act. “As a result of the Kingdom’s among-the-highest in the region coronavirus vaccination rates, the government was forced to adopt an endemic approach to Covid management,” he said. The word “forced” is interesting. It suggests the policy followed the reality on the ground, not the other way around.
Free trade agreements also drove the export numbers. Cambodia has been signing bilateral and multilateral deals. These agreements lower tariffs and open markets. They give Cambodian goods a price advantage abroad. The garment sector, agriculture, and manufactured products all benefit.
The annual meeting itself is a routine affair. Two days of officials reviewing spreadsheets and setting targets. But the context around it is not routine. Global trade faced serious headwinds in 2022. Many economies slowed. Supply chains snapped and re-snapped. Cambodia’s growth stands out because it happened despite all that.
What comes next is the hard part. Maintaining that momentum in 2023. The world economy is still shaky. Central banks are raising interest rates. Demand in major markets like the United States and Europe could cool. Cambodia’s export growth depends on those markets staying open and willing to buy.
The minister did not offer predictions for the current year. The meeting’s second day would focus on the ministry’s own plans. But the 2022 numbers set a high bar. They also showed what was possible when COVID restrictions came down early and trade deals were pursued aggressively.
