The World Bank will disburse some $540 million from 2018 to 2021 to finance economic development in Cambodia with a focus on supporting the implementation of the government’s Industrial Development Policy as well as other socio-economic projects.
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The committed financing was revealed on Tuesday in a meeting between the newly appointed World Bank representative to Cambodia, Ellen Goldstein, and Minister of Economy and Finance Aun Pornmoniroth, according to a press release from the Finance Ministry.
“Most recently, Cambodia has seen the fastest economic growth in East Asia. Through our partnership strategy, the World Bank will continue to support inclusive growth that benefits the poor,” said Ms Goldstein.
“The World Bank is committed to help and cooperate with the government and the $540 million financing from 2018 to 2021 will be used to boost Cambodia’s economic development and other social development projects,” she added.
Ms Goldstein said the funds would be prioritised to meet the needs of the government “following their strategic development plan and the 2015-2025 Industrial Development Policy”.
Currently, the World Bank has committed $243 million to Cambodia in its support for 12 projects.
Cambodia’s 2015-2025 Industrial Development Policy aims to transform and modernise the country’s industrial structure from a labour intensive industry to a skill-driven industry by 2025.
The IDP also promotes the development of the manufacturing sector and agro-processing industry through integration into regional and global production chains.
Mr Pornmoniroth said the financing “will contribute a lot to Cambodia’s development and give more access to implement many other projects to boost growth and poverty reduction”.
“The increase of financing to Cambodia emphasises the strong trust from the World Bank to Cambodia and it reflects the big contribution from the bank to Cambodia’s economic development,” he said.
The World Bank in its “Cambodia Economic Update” released in April stated that the country’s poverty reduction is expected to continue over the next few years, driven mainly by the garment, construction and services sectors, together with increases in remittances.
“The rural non-farm [garment, services and remittances] economy could be a significant contributor to poverty reduction and shared prosperity in Cambodia in years to come,” added the report.
The World Bank projected that Cambodia’s economic growth will be around 6.9 per cent this year while the poverty rate fell from 47.8 percent in 2007 to 13.5 percent in 2014.