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June 18, 2024

Korea Eximbank extends $120m to Cambodia for road development

PUBLISHED : May 19, 2024 - 09:14

UPDATED : May 19, 2024 - 09:14

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Korea Export-Import Bank President Yoon Hee-sung (second from right) and Cambodia's Secretary of State at the Ministry of Economy and Finance ROS Seilava (left) shake hands during a signing ceremony held Thursday at the presidential office in Seoul, with South Korean President Yoon Suk Yeol (right) and Cambodian Prime Minister Hun Manet in attendance. (Yonhap)

The state-run Export-Import Bank of Korea said Friday it has signed an agreement to provide a $120 million loan to Cambodia to support the enhancement of the Southeast Asian country's provincial road infrastructure.

Korea Eximbank President Yoon Hee-sung and ROS Seilava, secretary of state at Cambodia's Ministry of Economy and Finance, inked the contract at a ceremony held at the South Korean presidential office in Yongsan-gu, on the occasion of a summit between Korean President Yoon Suk Yeol and Cambodian Prime Minister Hun Manet in Seoul on Thursday.

The loan will be extended through the Economic Development Cooperation Fund, Korea's financial assistance scheme for developing countries entrusted to the Eximbank for operation by the Ministry of Economy and Finance.

With approximately $1.95 billion in accumulated loans under this initiative, Cambodia ranks as the third-largest partner for Korea's EDCF and maintains close cooperative relationships in various fields, such as the economy, culture, transportation and water resources.

The latest EDCF funding targets a provincial road infrastructure project aligned with Cambodia's long-term socioeconomic development plan, the "Pentagonal Strategy," The project involves the maintenance and repair of approximately 391 kilometers of roads across 37 routes in six southern Cambodian provinces to bolster regional connectivity and uplift local livelihoods.

"This contract marks the first project in Cambodia to receive over $100 million in support since the construction of the Korea-Cambodia Friendship Bridge in 2022," Eximbank President Yoon said Thursday.

"In addition to aiding the balanced regional development inside Cambodia, we also expect this opportunity to play a pivotal role as a stepping stone for overseas expansion and experience accumulation for Korea's small- and mid-sized firms," he added.

On the sidelines, Korean Deputy Prime Minister and Minister of Economy and Finance, Choi Sang-mok, and Cambodian Deputy Prime Minister and Minister of Foreign Affairs and International Cooperation, SOK Chenda Sophea, inked an agreement to raise South Korea's concessional loan contribution to Cambodia through the EDCF framework arrangement from $1.5 billion to $3 billion, extending its period from 2022-2026 to 2022-2030.

By Choi Ji-won (jwc@heraldcorp.com)

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