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ADB Grants Cambodia US $50 Million Loan To Support Trade and Competitiveness

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ADB Grants Cambodia US $50 Million Loan To Support Trade and Competitiveness
ADB Grants Cambodia US $50 Million Loan To Support Trade and Competitiveness./B2B Cambodia.

The Asian Development Bank (ADB) approved a US $50 million policy-based loan in November 2024 to support Cambodia’s efforts to improve the business environment and make the SEA nation more investment-friendly, address competitiveness, and ease trade barriers. 

The Asian Development Bank (ADB) has maintained its growth forecast for Cambodia at 5.8 per cent for 2024 and 6.0 per cent for 2025 and revised down its earlier inflation projection for 2024 from 2.0 to 0.5 per cent.

What Is The ADB Loan Intended To Do For Cambodia?

This latest loan is the second subprogram of the ongoing Trade and Competitiveness Program to reinforce the government’s efforts to leverage private sector investments. This is hoped to achieve higher, inclusive, and sustainable growth and is one of several loans Cambodia has received from the ADB.

In a nutshell, it should help streamline business regulations and enhance public services, making it easier to do business in Cambodia. .

ADB Country Director for Cambodia Jyotsana Varma said, "This program supports ADB’s continued commitment to advancing Cambodia’s economic potential and creating a more robust enabling ecosystem for business to grow, leading to increased investment, job creation, and sustainable economic growth. It focuses on micro, small, and medium-sized enterprises (MSMEs) as they are the backbone of the economy, and their growth is crucial to drive competitiveness. Through targeted incentives, we aim to empower them to diversify, integrate digital solutions, and increase productivity.

The ADB said there were three main interlinked constraints contributing to Cambodia’s broader development challenges which ‘reduce productivity and competitiveness and prevent the economy from fully realising its growth potential.’

  1. Aub-optimal enabling environment for investment and business.
  2. Underdeveloped MSMEs
  3. Barriers to cross-border trade.

Varma added, “This program also seeks to facilitate smoother, more efficient cross-border trade by improving regulatory frameworks, streamlining procedures, and reducing barriers to trade, leading to Cambodia being better positioned to participate in regional and global markets.”

The goal is by 2027,  for the program to have approximately 50,000 MSMEs formally registered in the online business registration system, and digitally secure necessary business licenses, certificates, and permits. 

Supplied - ADB

ADB Supporting Cambodia's Growth

Asian Development Bank (ADB) inaugurated its new resident mission in Phnom Penh in mid-2024, following the launch of its country partnership strategy for Cambodia from 2024 to 2028. As part of the five-year plan, accelerating private-sector-led economic diversification was one of the three strategic priorities identified for economic diversification.

Key to this approach is enhancing high-quality, climate-resilient infrastructure to attract private sector investments and fostering a healthy business environment that benefits micro, small, and medium-sized enterprises, especially those led by women.

ADB Loans To Cambodia 2024

  • In September 2024, US $93.6 million in financing was approved to support 'WASH' services in rural Cambodia.
  • In October 2024,  US $80 Million was granted to enhance access and quality of Secondary Education in Cambodia.
  • On 4 November 2024, US $10 million in grant financing was approved to address gender-based violence (GBV) in Cambodia.

The World Bank also approved US $275 million in credit to support Cambodia’s efforts to promote long-term economic growth and resilience in June 2024.

Cambodia Investments & Trade Opportunities 2024