Chea Poch shared a photo of himself sitting in a wheelchair on May 15. CHEA POCH VIA FB
The government is working on a draft law on government securities to replace the old one, the Ministry of Economy and Finance said on Tuesday.
This will pave the way to issue state securities, mobilise domestic financing, diversify the state capital portfolio and curb external borrowing, it said.
Demand for resources and financing continues to climb and could meet the real needs of socioeconomic development if underpinned by proactive measures to broaden the scope of funding sources, with emphasis on high-potential local ones, it added.
The current Law on Government Securities was issued by Royal Code No NS/RKM/0107/001 on January 12, 2007 and remains in force today.
The ministry said: “This new draft law is a legal basis to allow the government to issue securities by limiting the scope, deciding on the issuance, determining the size and form of the issuance of state securities, determining the participants and procedures for trading state securities, as well as penalties.”
“The new draft law is comprehensive and highly responsive to the current context and changing trends of Cambodia’s development through the setting of a common framework for the management of the issuance, trading and management of state securities, and the setting of specific objectives.
“This includes responding to financing needs, especially for infrastructure development, strengthening the management of cash requirements, developing the securities and finance sector, and supporting other priority and necessary projects.”
Ministry spokesman Meas Soksensan told The Post that the draft law is a comprehensive solution that enables the government to issue state securities to mobilise local resources and develop the Kingdom.
But he could not provide a concrete date by which the law would be formally approved by the Cabinet and Parliament.
“Considering that the current law is not exhaustive, we must review and design the new law in a more comprehensive manner which allows for its swift implementation,” Soksensan said.
Ministry secretary of state Vongsey Vissoth previously said securities are a primary mechanism for domestic resource mobilisation and shifting away from reliance on foreign aid.
“We cannot merely rely on external debt as a source of funds as it exposes us to additional risk,” he said.
From 1993 to 2017, Cambodia borrowed a total of $9.685 billion through concessional loans with development partners, the ministry reported.
This is equivalent to 43.7 per cent of the Kingdom’s $22,158,209,503 gross domestic product (GDP) in 2017, as shown by World Bank figures.
The ministry said the Kingdom borrowed $6.377 billion from other governments, of which a whopping $4.05 billion came from China.
The Cambodia Securities Exchange (CSX) launched in 2012 and welcomed its first domestically listed company, the state-owned utility Phnom Penh Water Supply Authority (PWSA), on April 18 that year.
The bourse currently has 12 listed firms – six bond-listed companies and six stock-listed companies. Pestech (Cambodia) Plc, a subsidiary of Malaysia-based Pestech International Bhd, plans to list next month.
The listed firms have raised around $240 million in trading. Market capitalisation increased 4.5-fold from last year to some $2.57 billion. The CSX index also rose 12 per cent over the same period.
As of last year, there were five central counterparties in the derivatives market, 27 derivatives brokers, five fund management companies and five trustees licensed by the Securities and Exchange Commission of Cambodia.
