Cambodia Gov’t Mulls Issuing Bonds Worth Over US$300 million in 2022

Cambodia Gov’t Mulls Issuing Bonds Worth Over US$300 million in 2022

The Cambodian government plans to issue its first sovereign bonds worth US$300 million worth next year to raise more funds for public investment projects to boost economic growth and productivity.

The Ministry of Economy and Finance (MEF) unveiled this plan in the executive summary of the Draft Law on Finance for 2022, which was approved in the cabinet meeting held on Friday 22 October chaired by Samdech Prime Minister Hun Sen.

The government bond issuance is part of a reduction in foreign loans, with the government focusing on mobilising domestic sources of finance.

UNDP also used to recommend Cambodia issue sovereign bonds to expand domestic financial resources for urban development projects. (Read more)

UNDP said that issuing sovereign bonds would not only help the government to generate more funds domestically but also would help to accelerate the development of the private capital market.

According to the MEF, the fund from the sovereign bond will add to concessional loans from development partners for 2022 of SDR 1.6 billion, or about US$2.2 billion, to support about 35 public investment projects.

The ministry states that the issuance of the sovereign bond and the above-mentioned loan will not create a debt burden on Cambodia. The situation of Cambodia’s public debt remains a sustainable and low risk. Besides, key debt indicators are also well below the respective indicative thresholds.

 

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