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Cambodia urged to borrow from Saudi fund

May Kunmakara / Khmer Times Share:
A flyover in Phnom Penh. KT/Mai Vireak

The Saudi Fund for Development (SFD) advised Cambodia to take out a soft loan with them in order to address key challenges to the country’s economic and social development.

The recommendation was put forward during a meeting between the Cambodian Minister of Economy and Finance Aun Pornmoniroth and Eng. Yousef Ibrahim Al-Bassam, SFD’s vice-president and managing director.

Mr Al-Bassam is in Cambodia leading a fact-finding mission to appraise the economic situation and development of the country and gauge Cambodia’s needs in terms of external financing.

“So far, we’ve given soft loans to 82 countries around the world.

“We do hope that Cambodia will become the 83rd country to cooperate with our institution,” he said.

Mr Pornmoniroth said they are now studying the possibility of working with SFD, adding that more financing is needed to tackle some of the country’s biggest development challenges.

“We are now prioritising the development of physical infrastructure like roads, water treatment facilities and power plants. We are also focused on the development of our human capital, particularly through professional training.

“We’ve also been working hard to improve health and education services in the country with the help of our development partners.

“We hope both sides, Cambodia and the Saudi Fund for Development, can work together for the development of the nation,” he added.

According to a joint-survey by the Japan International Cooperation Agency (JICA) and the International Monetary Fund (IMF) released in 2011, Cambodia needs more than $13 billion in infrastructure by 2020 to continue attracting foreign investment.

The country needs about $1.2 billion in infrastructure spending per year, the survey said, adding that about half should go to new projects and the other half to maintenance.

SFD was founded in 1974 with the goal of participating in the development of emergent economies by granting them the necessary loans, technical aid, and institutional support.

In 2017, Cambodia’s foreign debt stood at an estimated $7.1 billion. By the end of 2018, the government forecasts it will reach $7.8 billion.

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