Phnom Penh, Cambodia – The Cambodian government has outlined its financial plans for 2026, projecting a national revenue collection of at least $8.19 billion, while anticipating expenditures to reach $10.23 billion. This significant financial overview, released by the Ministry of Economy and Finance in its 2026 Budget Brief, indicates a planned budget deficit for the upcoming year.
According to the Ministry’s projections, Cambodia’s economy is expected to grow by only 5% in 2026. This modest growth forecast comes amidst a backdrop of increasing internal and external challenges and risks that could potentially impact the long-term sustainability and continuity of the nation’s development trajectory.
In response to these economic conditions and a context of heightened global uncertainty, the government has crafted its public financial policy for the medium term. This policy is anchored by a strategic stance focused on “strengthening budget effectiveness to support stability and growth.” The Royal Government’s primary objective under this approach is to enhance budget efficiency, both at the allocation and operational levels, through a continuous prioritization of spending.
The public expenditure framework for 2026 is designed to strategically direct resources towards several critical priority areas. These include bolstering national sovereignty and territorial integrity, maintaining socio-economic stability and improving the livelihoods of the Cambodian populace, promoting social equity, and sustaining ongoing social development initiatives. Additionally, ensuring the uninterrupted operational continuity of the Royal Government’s essential functions remains a key focus.
**Detailed Financial Projections for 2026:**
For 2026, the government aims to collect approximately $8.19 billion in national revenue, which is projected to represent 15.09% of the Gross Domestic Product (GDP). Concurrently, the planned national expenditure is set at around $10.23 billion, equivalent to 18.85% of GDP. The gap between these figures leads to an anticipated overall budget deficit of 3.76% of GDP.
**Revenue Breakdown:**
The total national revenue plan of $8.19 billion is primarily composed of:
* **Tax Revenue:** Expected to contribute $6.8 billion. Of this, the General Department of Customs aims to collect $3 billion, while the General Department of Taxation targets $3.7 billion. These tax collections form the primary source of national income.
* **Non-Tax Revenue:** Derived from the management of state assets and other non-tax sources, estimated at $1 billion.
* **Other Revenues:** Including both domestic and foreign sources, totaling approximately $300 million.
**Expenditure Breakdown:**
The planned national expenditure of $10.23 billion includes:
* **Current State Budget Expenditure:** Amounting to $6.8 billion. This is distributed across various levels and sectors:
* **National Level:** $6.3 billion is allocated to key sectors:
* General Administration: $800 million
* National Defense, Security, and Public Order: $1.42 billion
* Social Affairs: $2.46 billion
* Economic Sector: $464.5 million
* **Sub-National Level:** $1 billion is designated for local administration and initiatives.
* **Capital State Budget Expenditure:** Totaling $3.40 billion for 2026. This includes:
* Public investment financed by domestic sources: $1.64 billion
* Public investment financed by foreign sources: $1.76 billion
To bridge the expected deficit and meet the over $10 billion in national expenditures for 2026, the government plans to secure financing from both domestic investors and various international development partners. The Ministry of Economy and Finance indicates plans to issue government bonds (state securities) worth $524 million. These bonds are intended to finance investment expenditures and help maintain the national budget balance.
Furthermore, the Royal Government intends to borrow approximately $3.1 billion from development partners, an increase of $250 million SDR compared to 2025. This borrowing strategy is driven by the significant demand for public investment required to mobilize additional resources for economic growth. In 2026, Cambodia is set to implement development programs and projects that are aligned with new concessional credit agreements. These public investment initiatives are focused on priority sectors, particularly physical infrastructure and enhancing economic and production productivity, which are considered strategic for sustaining long-term economic growth.
The Ministry of Economy and Finance has emphasized that these foreign loans are concessional, meaning they come with favorable terms. The 2026 Budget Brief reassures that Cambodia’s public debt status remains “sustainable” and at a “low risk” both currently and in the medium term. The Ministry clarifies that the issuance of government bonds and foreign borrowing, collectively exceeding $3.6 billion, will not impose an onerous debt burden on the nation. From a technical perspective, Cambodia’s public debt situation continues to be assessed as sustainable with low risk, as all key debt indicators remain well within benchmark ratios.
