Siem Reap Times

Sunday, Dec 22, 2024

Cambodia Plans to Seek $2 Billion in Special Drawing Rights for Development in 2025

Experts assure the debt remains manageable if funds are used transparently and strategically.
Cambodia plans to secure approximately $2 billion in Special Drawing Rights (SDR) for development projects in 2025, marking a 17.6 percent increase from the previous year. The funds, equivalent to $2.6 billion, will support public investment initiatives aimed at boosting infrastructure, economic growth, and foreign investment opportunities.

Under the Financial Management Law for 2024, the Ministry of Economy and Finance holds sole authority to execute these concessional loans, with approval from the Prime Minister. Progress reports on loan implementation will be submitted biannually to the National Assembly and Senate.

Economic researcher Hong Vannak from the Royal Academy of Cambodia emphasized that Cambodia's debt remains sustainable, with a clear repayment history and strategic development plans in place. However, he cautioned against mismanagement and called for transparency in fund allocation to prevent risks of spiraling debt.

NGO Forum Executive Director Soeung Saroeun echoed these sentiments, highlighting the importance of channeling the funds towards sustainable development goals, job creation, and human resource enhancement. He also stressed the need for reducing reliance on loans through alternative financial mobilization efforts.

As of the third quarter of 2024, Cambodia’s public debt stood at $11.78 billion, with new loan agreements signed totaling $1.07 billion—46 percent of the annual borrowing limit. Experts remain optimistic that Cambodia's borrowing will continue to be manageable, provided the funds are utilized strategically and with strong governance.

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