AKP Phnom Penh, February 14, 2025 --

The European Union (EU) will extend trade preference scheme for Cambodia for three years after the country graduates from the Least Development Country (LDC) status, a senior official at the Ministry of Economy and Finance said. 

Cambodia is set to graduate from the LDC category in 2029 and become an upper middle-income economy in 2030.

The EU’s trade preference scheme to Cambodia will be extended to 2032, H.E. Phan Phalla, Secretary of State at the Ministry of Economy and Finance said. 

“The European Union will not immediately end its trade preference. The EU gives us another three years, till 2032,” H.E. Phan Phalla said in a conference held in Phnom Penh earlier this week.

Criteria for graduation assessment include the Gross National Income per capita, the Human Assets Index and the Economic and Environmental Vulnerability Index.

The Royal Government of Cambodia is currently collaborating with partners such as UNDP and UN Agencies to prepare for some of the challenges that will arise after Cambodia upgrades from LDC status in 2029. 

Cambodia exported US$4.41 billion worth of goods to the European Union (EU) last year, marking a 20.34 percent increase from US$3.66 million recorded in 2023, according to a report from the Ministry of Commerce.

The country’s trade with the EU accounted for 9.62 percent of the total trade amounting to US$55.37 billion, it added. 
The UN General Assembly adopted last December a resolution confirming the graduation of Cambodia from the LDC category in 2029.

The UN General Assembly assured continued support to Cambodia during the transition period and thereafter. The country could also collaborate with their bilateral, regional, and multilateral partners for the transition.

In January 2025, the UK decided to extend Cambodia’s benefits under the Developing Countries Trading Scheme (DCTS) for an additional three years after its graduation from Least Developed Country (LDC) status until 2032, aiming to ensure a smooth economic transition.

By Chea Vannak