The Asian Development Bank (ADB) has approved a $70 million loan to improve the capacity of agribusinesses in six provinces across Cambodia to process key agricultural products such as cassava, cashews, mangoes, vegetables, and poultry.
Under the agricultural value chain competitiveness and safety enhancement project, it aims to benefit about 230 agricultural cooperatives and 50 agribusinesses in the provinces of Kampong Cham, Kampong Thom, Oddar Meanchey, Preah Vihear, Siem Reap, and Tboung Khmum.
Agriculture can contribute to Cambodia’s economic growth and diversification if local small and medium-sized agribusinesses can improve their ability to process high-value agricultural products and market them domestically and overseas, said ADB Principal Natural Resources and Agriculture Economist Takeshi Ueda.
“Private investment in agriculture, along with better access to credit and high-quality raw agricultural products, will help Cambodian agribusinesses unleash their growth potential, create jobs, and improve rural livelihoods.” Ueda added.
Processed agro-based goods now account for just 4 percent of GDP, due to a lack of diverse, value-added products. The coronavirus disease (COVID-19) pandemic has disrupted agricultural supply chains and reduced incomes and market opportunities for farmers and agribusinesses, according to ADB.
According to ADB, the project will facilitate access to credit for agriculture and agribusinesses, which attract only about 10 percent of total formal financing. The project will implement mutually reinforcing financial schemes, including credit lines and credit guarantees, according to ADB.
ADB said that the project will support initiatives to strengthen food safety and quality across the value chains for cassava, cashews, mangoes, vegetables, and native chickens. It will help agricultural cooperatives adopt good agricultural practices and upgrade food-safety testing laboratories to gain international accreditation.
“The project will also support the research and development of crop seed varieties and poultry breeds by helping agricultural cooperatives access high-yield, drought-resilient, disease-resistant crop seeds and other planting materials. In addition, the project will help improve 110 kilometers of rural roads and help connect farms to markets in the project areas,” it said.