FOREWORD In 2023, the global economy still faces prolonged effects of Russia-Ukraine war, Israel-Hamas war, tightened monetary policy, and China’s economic slowdown. The International Monetary Fund (IMF) forecasted that the global economic growth will be at 3%, while growth will be at 1.5% for advanced economies, 4% for emerging market and developing economies, and 4.4% for the ASEAN-51 economies. However, Cambodia’s economic growth is estimated to be at 5.5% in 2023 and could reach 6.4% in 2024. Political stability, a foundation of public trust and sustainable development, is the driving force to achieve such growth. The new royal government led by Samdech Moha Borvor Thipadei HUN MANET, Prime Minister of the Kingdom of Cambodia, has launched the Pentagonal Strategy-Phase I with clear goals and long-term vision for economic and social development by focusing on 5 key priorities, namely People, Road, Water, Electricity, and Technology. As a supervisory authority, the National Bank of Cambodia (NBC) has actively involved in supporting the Royal Government of Cambodia (RGC) policy in order to maintain financial stability and promote sustainable and inclusive growth. The NBC continues to strengthen resilience and growth of Cambodia’s banking system by deploying a number of macro-prudential measures to mitigate systemic risk. In the meantime, the supervision of banks and financial institutions has been enhanced regularly through risk-based and forward-looking supervision, stress testing, meeting with management of banks and financial institutions, and on-site inspection to monitor and assess banks’ resilience and level of compliance with law and regulations. Furthermore, the NBC has issued various regulatory forbearances for banks and financial institutions to support the economic activities which just recovered from the COVID-19 crisis. Currently, new regulations have been drafted in consistent with local and international market development, as well as global supervisory standards, particularly the Basel standards. The NBC has focused on advancing financial inclusion, financial literacy, and consumer protection through close collaboration with related stakeholders to implement action plans set in the National Financial Inclusion Strategy (FNIS) 2019-2025. Additionally, green economy development and response to climate change have also been the center of attention aiming to promote sustainable finance and support the policies of the RGC. To support the Government’s digital economy and society policy, the NBC continues to modernize the payment systems infrastructure enthusiastically to be in line with the growth of financial technology. Payment system infrastructures have been linked through the establishment of Bakong systems, Cambodian Shared Switch (CSS), and standard KHQR Code to facilitate payment transactions and make them more convenient, faster, secure, and affordable. Moreover, the connection with international payment systems is in progress to further expand the infrastructure.

Phnom Penh, 22 April 2024
CHEA SEREY
Governor
National Bank of Cambodia