Logo of Phnom Penh Post newspaper Phnom Penh Post - Rural bank braces for loan request surge

Rural bank braces for loan request surge

Rural bank braces for loan request surge

THE state-run Rural Development Bank anticipates US$100 million in requests for credit to purchase paddy this year, dwarfing the $36 million in financing committed by the Cambodian government.

Some 150 companies and rice associations are expected to request $100 million in loans to purchase rice for milling. The amount would more than double the $46 million in requests made by 300 companies last year, bank chairman Son Koun Thor said yesterday.

“The desire for loans to process rice for export started to increase after the government unveiled new policies for boosting rice production in August,” he said.

On August 17, Prime Minister Hun Sen announced that the government would guarantee 50 percent of commercial bank lending to rice producers in a bid to increase Cambodia’s exports of the grain to a million tonnes by 2015.

The government has worked hard to increase exports of milled rice, according to Son Koun Thor, as it brought in more income than paddy exports.

Rural Development Bank’s lending contributes to the purchase of 10 percent of the country’s excess paddy, according to Son Koun Thor.

The bank will receive $36 million in state financing this year, double last year’s contribution, officials announced earlier this year.

Kampong Cham Province Rice Mills Association president Suor Kheang said that his association already possessed US$5 million to purchase paddy, but that it was not enough to purchase all the excess grain produced in the province.

The association would seek an additional $1 million in loans from the Rural Development Bank, he said.

“We hope the association will be successful,” he said. “The government wants excess production to be milled and exported more in the future.”

MOST VIEWED

  • Chinese influx pushing locals, Westerners out of Preah Sihanouk

    Some within the Kingdom’s tourism industry have speculated that the recent influx of Chinese visitors may hinder domestic tourism as the price of accommodations in the coastal city of Sihanoukville continues to rise. Preah Sihanouk province, which has become a hotbed for Chinese investment

  • ‘Dire consequences’ from sanctions, warns AmCham

    American businesspeople in Cambodia have warned that any sanction against the Kingdom would have “dire consequences” that could push Cambodia even further into the arms of China. In a letter to US senators and representatives dated Monday, the American Chamber of Commerce Cambodia (AmCham) said

  • CPP: ‘Behave or Sokha suffers’

    The ruling Cambodian People’s Party (CPP) spokesman warned Kem Monovithya on Thursday that her attempt to damage “national reputation and prestige” would lead to her father, Kem Sokha, receiving even harsher punishment. Sok Eysan issued the warning as Monovithya, who is the court dissolved

  • Preah Sihanouk beach developments halted

    After receiving an order from Hun Sen, Minister of Land Management Chea Sophara led a team of experts and relevant officials to Sihanoukville to call a halt to the illegal development of a beach. The prime minister ordered the Prek Treng beach in Otres commune