Cambodia is accelerating its urban development agenda as rapid population growth, rising incomes, and regional integration reshape the country’s cities.
With Phnom Penh, Siem Reap, and Sihanoukville expanding at unprecedented rates, the government is prioritising affordable housing, infrastructure upgrades, and smart city innovation to build more inclusive and sustainable urban centres.
Urbanisation Driving New Realities
According to the Ministry of Land Management, Urban Planning and Construction (MLMUPC), Cambodia’s urban population reached 6.8 million in 2024, representing 41 percent of the national total. Projections indicate that more than half of Cambodians will live in cities by 2035.
This rapid shift is increasing demand for housing, public transport, green spaces, and digital services. Phnom Penh alone is expected to add nearly one million residents over the next decade.
“Urbanisation presents both opportunity and pressure,” said Minister Chea Sophara. “We need development that is people-centred, climate-resilient, and economically dynamic.”
Expanding Affordable Housing
The government has intensified its focus on affordable housing to address growing inequality in urban areas. The National Housing Policy and Affordable Housing Strategy 2030 encourage private developers to allocate up to 20 percent of new projects to lower-income households.
Several public–private partnerships are underway. The Phnom Penh Affordable Housing Programme, supported by the World Bank, will deliver more than 30,000 housing units by 2028, with integrated access to schools, clinics, and mass transit.
Meanwhile, local banks such as ACLEDA and Canadia Bank have expanded mortgage products for low-income families, supported by interest-rate subsidies and risk-sharing mechanisms from the government.
Smart Cities: The Next Phase of Urban Growth
Smart city development has become a national priority. Under the Cambodia Digital Economy and Society Policy Framework 2021–2035, urban authorities are integrating data systems, intelligent mobility solutions, and digital public services.
Phnom Penh has piloted smart traffic lights, remote water monitoring, and a city-wide CCTV network linked to AI analytics. The Smart City Siem Reap Initiative, funded partly through Japanese cooperation, includes smart parking, digital tourism services, and waste management automation.
“These innovations are not about technology for its own sake,” said Sophea Chan, policy analyst. “They are tools to improve liveability and expand access to essential services.”
Infrastructure for a Connected Future
Mass transit expansion remains central to Cambodia’s urban strategy. Plans for a Phnom Penh Bus Rapid Transit (BRT)system are moving forward, supported by feasibility studies from the Asian Development Bank (ADB) and the Korea International Cooperation Agency (KOICA).
The government is also modernising wastewater treatment and expanding renewable-powered street lighting in key corridors, improving environmental sustainability and public safety.
Governance and Inclusive Growth
To ensure responsible planning, the government is introducing land-use zoning reforms, environmental impact compliance, and updated building codes aligned with ASEAN standards.
Civil society groups are also playing a growing role in urban design, advocating for green spaces, pedestrian access, and protection of heritage areas.
Affordable housing cooperatives are emerging in peri-urban districts, allowing communities to co-develop housing solutions with support from NGOs such as Habitat for Humanity Cambodia.
A Vision for Sustainable Cities
Cambodia’s urban future is being shaped by the interplay of affordability, technology, and governance. As smart city initiatives mature and housing investment scales up, the country is laying the foundation for vibrant, inclusive, and climate-resilient cities.
If effectively implemented, Cambodia’s urban reforms could serve as a model for emerging Southeast Asian economies facing similar demographic and development pressures.
