Core Insights - Cambodia's industrial sector is projected to achieve a growth rate of 7.1% by 2025, despite external challenges, with the garment industry being a significant contributor [2] - The garment industry is expected to grow by 10.1%, although growth may weaken towards the end of the year due to new export tariffs imposed by the U.S. [2] - Non-garment manufacturing is anticipated to grow by 6.9%, falling short of initial expectations due to supply chain disruptions and tariff impacts [2] Industry Performance - The automotive assembly and food and beverage sectors are maintaining stable growth, while the construction industry is gradually recovering [2] - Significant growth in non-garment exports was observed in the first half of 2025, with electronic components up by 24.3%, furniture by 39.4%, automotive parts by 10.1%, bicycles by 41.6%, tires by 80.4%, and wires and cables by 194.9% [3] - Conversely, solar panel exports plummeted by 98.9% due to increased tariffs in the U.S. market [3] Market Diversification - Cambodia's ability to diversify its export markets is crucial for sustaining growth, particularly as it expands into the EU and China to mitigate the impact of declining U.S. market demand [3] - The Cambodian government emphasizes that the diversification of export markets is a key driver for economic stability and growth in the face of trade friction and tariff disputes [3]

Group 1 - The Cambodian Ministry of Economy and Finance forecasts a robust growth of 7.1% in the industrial sector by 2025, slightly lower than previous expectations due to a slowdown in the garment and non-garment manufacturing industries [1] - The garment industry, as the largest pillar of Cambodia's industrial sector, is expected to achieve a growth rate of 10.1%, although this growth may weaken towards the end of the year due to new export tariffs imposed by the US starting in August [1] - Non-garment manufacturing is projected to grow by 6.9%, falling short of initial expectations, impacted by tensions at the Cambodia-Thailand border affecting raw material flow and tariffs on various export categories to the US [1] Group 2 - Significant growth was observed in several non-garment export categories in the first half of 2025, including electronic components (24.3%), furniture (39.4%), auto parts (10.1%), bicycles (41.6%), tires (80.4%), and a remarkable 194.9% increase in wires and cables [2] - The export of solar panels plummeted by 98.9% due to increased tariffs in the US market [2] - The diversification of export markets, particularly in the EU and China, is seen as a key driver for growth in the second half of 2025, helping Cambodia mitigate external risks and ensure steady economic development [2]