After Prime Minister Hun Sen announced that he would hand over the reins of office to his eldest son, the ruling party has been very busy initiating the transition behind the scenes. To secure this dynastic succession, anti-democratic tendencies have deepened and constitutional amendments were made.
Following a recession in 2020, the country has resumed its path of economic growth. Additionally, the adoption of the Law on Investment and the Competition in 2021 laid the groundwork for a stronger regulatory policy. However, the recent significant increases in inflation, private debt and non-performing loans are the main short-term risks for the country’s economic development.
Despite the high level of corruption, state authorities efficiently and professionally disbursed social transfers during the COVID-19 pandemic. Efforts to develop welfare state structures have also been intensified. Nonetheless, the ongoing failure of political decision-makers to prioritize ecological sustainability and environmental protection poses a persistent risk.
