Logo of Phnom Penh Post newspaper Phnom Penh Post - ADB signs $180M in loans to Cambodia

ADB signs $180M in loans to Cambodia

Workers construct a section of the road on the southern outskirts of Phnom Penh in 2014.
Workers construct a section of the road on the southern outskirts of Phnom Penh in 2014. Heng Chivoan

ADB signs $180M in loans to Cambodia

The Asian Development Bank (ADB) yesterday signed a $180 million package of loans and grants to Cambodia that are meant to improve the country’s roads, water supply and small-scale farms.

One $70 million loan will go towards improving 147-kilometres’ worth of flood-prone stretches of National Road 1 and National Road 6 in Prey Veng, Siem Reap and Svay Rieng provinces.

Another $50 million loan will go towards improving and expanding sewage infrastructure and water treatment plants in the provincial capitals of Battambang, Kampong Cham, Siem Reap and Sihanoukville. The loan was accompanied by a $10 million grant from the Japanese government to build an energy-efficient wastewater treatment plant in Battambang province.

The third project – comprising a $45.7 million loan and $4.3 million grant – will go toward increasing the productivity of smallholder farmers in provinces in the Tonle Sap river basin.

“All three projects have the common goal: To reduce poverty and accelerate Cambodian livelihood, in both the urban areas and rural areas,” Finance Minister Aun Porn Moniroth said at the signing ceremony in Phnom Penh yesterday.

ADB Country Director Samiuela Tukuafu declined to answer questions yesterday about the exact interest rates of the loans, but noted that they were all concessional, which generally means they are more favourable for the borrower than a market-rate loan.

“We look forward to working closely with our colleagues in government to successfully implement all three projects for the benefit of the Cambodian people,” he said.

The ADB’s two largest donors are the US and Japan, both of which have expressed concern at the Cambodian government’s recent moves to dissolve and jail its primary political opposition.

But Sophal Ear, associate professor of diplomacy and world affairs at Occidental College in Los Angeles, said a loan this size would likely have been years in the making, though he noted the ADB was rarely concerned about internal politics.

“Well, obviously, rewarding a country that kills democracy with a $200 million loan isn’t a great thing,” Ear said. “But the ADB isn’t probably thinking that far. Democracy isn’t in their charter. The internal political system is not a consideration, and if they loan to Vietnam and Laos, goes their thinking, why not to Cambodia.”

The ADB has lent a total of $2.29 billion to Cambodia, and given an additional $455 million in grants.

At the end of 2016, Cambodia’s stock of external public debt, including arrears, stood at around $6.45 billion, or about 32 percent of the country’s GDP, according to the International Monetary Fund.

MOST VIEWED

  • With herd immunity likely in 2022, is Cambodia ready to reopen for tourism?

    The government aims to inoculate 80 per cent of the target population by June next year, giving it a head start among regional peers to reboot the sector but first, it has to do a few things to up its game A sign on a glass

  • Quarantine still a must for all arrivals, in next Covid chapter

    Since early May, an average of five to 10 Cambodian people have died from Covid-19 a day with many others testing positive amid the ongoing community outbreak. At the same time, however, hundreds of patients also recovered a day. The first Covid-19 case in Cambodia was

  • US wants 'full access' to Ream Naval Base

    On June 11, the US embassy's Defense Attaché Colonel Marcus M Ferrara visited Ream Nava Base in coordination with Cambodian officials following the recent approval of Prime minister Hun Sen to allay the concerns on Chinese military presence at the base as raised by US Deputy

  • Jab drive heading to 5 provinces

    The government is set to vaccinate more than 1.2 million people in five provinces after finishing with Phnom Penh and neighbouring Kandal in an ongoing campaign administered by the ministries of Health and National Defence. The five provinces are Preah Sihanouk, Kampong Speu, Takeo, Kampong Cham

  • New immigration bill targets illegal foreigners in Kingdom

    General Department of Immigration (GDI) officials are discussing revisions to the new draft law on immigration to prevent foreigners from entering Cambodia illegally and to supervise those living in the Kingdom more effectively. The revisions draw wide support among civil society organisations. GDI director-general Kirth

  • Kingdom set to be a gold producer

    Cambodia will soon join the roster of gold producing countries after the government announced the commencement of commercial gold mining operations in the Okvau area in southwestern Mondulkiri province's Keo Seima district from June 21. Prime Minister Hun Sen on June 10 announced that after 14 years of