The Cambodian People's Party (CPP) will remain politically dominant in the forecast period. At the July 2008 general election the CPP tightened its grip on power, winning 90 of the 123 seats in the National Assembly (the lower house of parliament). The CPP's poll victories, coupled with the authoritarian tendencies of the prime minister, Hun Sen, and the ruling party's harsh treatment of its opponents, have increased concerns that Cambodia is becoming a de facto one-party state with few checks on executive power. In recent years the courts have upheld several convictions against prominent opposition figures, such as Sam Rainsy, the leader of the main opposition Sam Rainsy Party (SRP), who has been sentenced in absentia to a total of 12 years in prison. Sam Rainsy, who returned from a year of self-imposed exile in 2006 after being pardoned for defaming Hun Sen and Prince Norodom Sihanouk, has chosen to remain abroad rather than return home to a prison cell.

The state apparatus will continue to be used against the government's opponents. In October 2009 the lower house approved laws restricting freedom of assembly and expression. The authorities in the capital, Phnom Penh, have since outlawed demonstrations except at an officially designated "freedom park" located some distance from government buildings and parliament. Reforms aimed at improving governance will be assigned a lower priority than efforts to entrench CPP rule, as seen in March 2010, when the lower house approved an anti-corruption law under which an anti-corruption council and other bodies are answerable to the very officials whom they are meant to hold to account. A proposed law on trade unions, as it is currently drafted, would impose new restrictions on organised labour. Meanwhile, Hun Sen has ordered leading companies to sponsor units of the armed forces-a move that will make the military even less accountable.

Social tensions will persist during the forecast period. The economy has begun to recover following the 2009 domestic recession, which saw a collapse in garment exports and tens of thousands of job losses among factory workers. However, as the threat of redundancy has receded amid a recovery in export orders from the US and Europe, trade unions in the garment sector have staged a series of strikes, including a walk-out by tens of thousands of factory workers in mid-September 2010 to demand a rise in the minimum wage. Meanwhile, land grabs by agricultural companies and property developers, often with close links to senior members of the CPP, have driven entire communities from their homes. The SRP-led opposition will seek to exploit such tensions for its own political ends, but Hun Sen is now so entrenched in power that any electoral challenge to his rule seems set to fail.