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Home / News

[Phnom Penh Post] - PM appeals for concessional interest rates, BOT projects

2023-02-27 Go to the website published Phnom Penh Post
Prime Minister Hun Sen called on development partners to continue offering concessional interest rates to Cambodia, even though the Kingdom would soon emerge from the category of least developed countries (LDCs). He expressed concerns that when Cambodia emerges from the category, lenders might only offer loans at commercial interest rates. “When a country is poor, it receives concessional interest rates. I have suggested to Japan, South Korea, the World Bank and Asian Development Bank that they continue to offer us low interest rates,” he said while addressing a February 27 graduation ceremony for students of the National Technical Training Institute. “In the near future, even though Cambodia graduates from the LDC category, we will still be calling on our partners to give us loans at concessional interest rates. With heavy interest rates, it is not profitable to do business and we need to build bridges and other infrastructure,” he added. The premier has announced that the Kingdom plans to develop a high-speed rail network. “The government must transform all of Cambodia’s railways into high-speed lines. The current trains run at 30km/h while high-speed ones travel at 130km/h, making them far more efficient. I call on other countries to participate and help us through BOT [Build, Operate, and Transfer]” projects, said Hun Sen. He explained that the government does not want to borrow a large amount of money to upgrade the railways. “When France’s foreign trade minister Olivier Becht visited, he was very encouraging. I suggested that a French company upgrade the rail network through a BOT arrangement, like what we did with the Phnom Penh-Sihanoukville Expressway. We pay to use the expressway, and the project owners recoup their costs in this way,” he said. He added that the expressway saved time and money for many people, particularly as petroleum prices are rising. “Soon, we will begin construction of an expressway which will connect Phnom Penh with Bavet town in Svay Rieng province. Vietnam will build an expressway from Ho Chi Minh City to the Cambodian border,” he continued. Royal Academy of Cambodia secretary-general Yang Peou said that in response to the likely end to concessionary interest rates, the Kingdom must strengthen itself. This could be done through reforming the tax management system of through vocational training. “We need to set our own clear political goals and strengthen our capacity. In the next few years, we will be strong enough that we do not need to ask for favours,” he told The Post on February 27. Peou called on “friendly” countries and strategic partners, like China and Japan, to continue to favour Cambodia at an appropriate level.
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