Political stability is a chief reason behind the Kingdom’s steady flow of foreign development aid and loans, a government official said yesterday.
Speaking to reporters shortly after the Japanese ambassador signed off on a $90 million, low-interest-rate development loan for a road expansion project in a ceremony presided over by Prime Minister Hun Sen, Foreign Affairs Ministry spokesman Koy Kuong said the Kingdom could expect to see skyrocketing investment.
“We hope that Japanese investment will double in 2013,” said Kuong. “This is because of political stability and credit laws in Cambodia.”
The road project approved yesterday is to repair a 47-kilometre stretch of National Road 5 linking Battambang to Banteay Meanchey. That, in turn, is part of a larger network aimed at linking Bangkok, Phnom Penh and Ho Chi Minh city to boost trade and tourism.
The interest rate of the Japanese loan is pegged at 0.01 per cent per year over 40 years, including a 10-year grace period.
With little fanfare, Japan has remained Cambodia’s largest bilateral donor over the past two decades. More than $200 billion has been disbursed since 1992, with little sign of slowing. According to Kuong, $335 million has been provided in the past two years alone – a figure that includes $139 million in concessional loans. Investment, meanwhile, has skyrocketed from $120 million in 2011 to $259 million a year later.