Government to Borrow 1,700m SDR in 2023

The government has unveiled plans to borrow 1,700 million SDR - an IMF reserve that can be converted into cash - to fund investment in infrastructure, economic productivity and agricultural production in 2023.
Ministry of Economy and Finance, October 26, 2022. Kiripost/Siv Channa
Ministry of Economy and Finance, October 26, 2022. Kiripost/Siv Channa

In 2023, the Royal Government of Cambodia plans to borrow 1,700 million Special Drawing Rights (SDR) from development partners, an increase of 100 million, while Cambodia debt for 2022 stands at $9,575,97, mostly with China.

According to the draft law on financial management 2023 released on October 28, Cambodia has set size loans from development partners for 2023 of around 1,700 million SDR, a 100 million increase, to fund investments, push up infrastructure, economic productivity, agricultural production and other needs.

An SDR is a form of International Monetary Fund reserves that can be converted into cash on demand.

In 2023, Cambodia plans to issue the sale of second initial public offering (IPO) of $200 million to repay the principal of the issuance of 2022.

“It cannot increase the debt burden of Cambodia, in terms of technical aspects, the state of public debt. Cambodia is still considered sustainable and low risk,” the statement added.

In addition, the royal government plans to spend 39,206,205 Riels ($9.4 billion) mostly on human resources, while the national budget is only 29,311,747 Riels ( $7 billion).

“Money will be provided to boost civil servants, development of Run Ta Ek and Peak Sneng, preparation for electricity of Cambodia, to process national assembly elections, and to organize the SEA Games and ASEAN Para Games in 2023,” the statement said.

Moreover, inflation is expected to rise to about 2.5 percent in 2023 due to expectations of a return to normalcy of international gasoline.

“​The planned inflation situation may be higher than expected due to the prolongation of international commodity prices, especially fuel prices caused by supply shock,” the​​ statement added.