Cambodian operator secures financing deal with Bank of China

November 12th 2010, James Barton

The Bank of China has agreed to loan a total of US$591 million to Cambodia’s largest mobile operator, in a financing agreement unprecedented in the Southeast Asian nation’s history.

The operator in question is CamGSM, which owns two of Cambodia’s mobile brands – MobiTel and Cellcard – and is itself a subsidiary of the country’s largest private conglomerate, Royal Group.

The loan will fund a five-year contract with Huawei to provide infrastructure and services. The US$500 million deal is one of a series of agreements between Cambodia and China that have a reported total value of around US$6.4 billion.

The large number and massive value of the deals has raised questions over the strength of China’s influence in Cambodia, an issue that was recently highlighted by US Secretary of State Hilary Clinton. Speaking in Cambodia last month, Clinton urged the country to pursue a foreign policy that was not “too dependent” on China.

Royal Group aims to use some of the money loaned from China to refinance an existing loan from Standard Bank and Australia and New Zealand Banking Group – specifically, a bridging loan of US$421 million that the conglomerate used to acquire a majority stake in CamGSM last year.

CamGSM was reported to have nearly 2.5 million subscribers in the third quarter, making it Cambodia’s largest mobile operator.


World Bank Grant Cambodia 40 million dollars

Sun Narin

November 14

World Bank granted Cambodia’s government forty million dollars on Thursday to restore the losses and damage caused by Typhoon Ketsana which hit the country last year.

Deputy prime minister and minister of finance and economy Keat Chhon said that the assistance is classified into two forms, one of which is 20 million U.S. dollars as in grant and another 20 million U.S. dollars as in credit.

The assistance aims to restore transportation and water and sanitation services to the affected people who are mostly poor and live in the rural areas, as well as to strengthen the capacity of the government in disaster preparedness and management.
This four-year rehabilitation project will focus on four main components such as the rehabilitation, reconstruction and improvement of 920 km of existing rural roads, including bridges, culverts and drainage facilities.

The World Bank’s program in Cambodia is designed to provide support to the poorest segments of the population, within the overarching goal to improve governance.

Keat Chhon said that including the 40 million U.S. dollars aid, World Bank has financed a total of 1,099 million U.S. dollars to Cambodia since 1993, of which 733.5 million U.S. dollars is credit and 365.5 million U.S. dollars is grant.