Foreign Aid

Foreign Aid in Cambodia

Most of Cambodia's foreign aid dollars goes to infrastructure development. Such infrastructure is necessary for economic growth and utilization of capital.

Compared to other high-growth neighbors in ASEAN such as Thailand and Vietnam, Cambodia's net foreign investment has maintained a positive trend and has not gone into the negatives, which typically happens when countries pay back more than they receive due to overwhelming debt servicing costs. Such trends suggest that Cambodia has a sustainable development policy.

Compared to ASEAN and low-income cohorts, Cambodia receives more aid from abroad. Whilst high foreign aid may be an indicator of poor economic development, Cambodia's recent trends of high aid is reflective of aid received during the COVID pandemic, notably from China. As such, it is likely that Cambodia is perceived as developing at the pace similar to that of other developing countries.

What is Foreign Aid?

Foreign aid (as per OECD) is the aid of a foreign government to support economic development and welfare of developing countries.