Cambodia Signs Concessional Loans Worth US$488 Million, Bolstering Public Investments for Sustainable Growth

• 22 June 2023
• Local News
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Cambodia’s commitment to fostering sustainable economic growth and driving public investments received a significant boost in the first quarter of this year, as the Cambodian government inked new concessional loan agreements with development partners. The total amount of these loans reached an impressive US$488 million, propelling the country’s public debt to US$10.23 billion as of March, according to the Cambodia Public Debt Statistical Bulletin released by the Ministry of Economy and Finance on 8th June.

Of the total concessional loans signed, 34 percent involved development partners, while 66 percent were secured from multilateral development partners. Notably, this represents a notable 54 percent increase compared to the same period last year, reflecting Cambodia’s commitment to securing vital funding for priority sectors that foster long-term sustainable economic growth and enhance productivity.

The Ministry of Economy and Finance’s (MEF) bulletin highlighted the highly concessional nature of these loans, with an average grant element of approximately 38 percent. Such favorable terms testify to the commitment of Cambodia’s developing partners in supporting the nation’s development agenda.

“The purpose of these newly signed loans is to provide the necessary financial resources for public investment projects that will drive economic productivity and bolster long-term growth. These investments are directed towards priority sectors that are crucial in fostering sustainable economic development, ensuring Cambodia’s prosperity for years to come.” Said spokesperson of the MEF.

In addition to securing concessional loans, the government issued government securities worth KHR100 billion (equivalent to US$24.67 million) during Q1 2023. These funds, accounting for 12.30 percent of the legally permitted ceiling (KHR 813 billion), are earmarked to provide crucial financial support for public investments, further bolstering economic growth and productivity.

Furthermore, the government demonstrated its commitment to responsible debt management, as debt service payments during the period amounted to US$180.68 million. This represents a 3 percent decrease compared to the same period last year, indicating the government’s efforts to maintain fiscal sustainability while ensuring continued investments for the nation’s progress.

With the signing of these substantial concessional loans, Cambodia solidifies its position as an attractive investment destination and underscores its determination to drive sustainable development. The nation’s emphasis on prudent financial management and strategic investments paves the way for a prosperous future, fostering economic growth, and improving the well-being of its citizens.

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