Phnom Penh (Cambodia Herald/ANN) - Cambodian Finance Minister Keat Chhun said yesterday that Cambodia's external debt amounted to US$3.6 billion, less than half the US$8 billion claimed by opposition parties.
"Any loans are made according to four joint principles such as proper loans that the national economy can afford," he told the National Assembly. "We borrow at concessionary rates by paying back only 65 per cent of the total amount.
"What we should be proud of that Cambodia doesn¡¯t borrow debt to buy ... weapons and tanks, but we use funds with transparency and high effectiveness," he said.
"We need capital to develop the country and we are currently trying to attract foreign investors."
Currently, Cambodia owes only US$3.6 billion including dirty loans from the war period. Ninety-nine per cent of the loans are from foreign countries.
"From 1992 until now, the government signed agreements worth US$5.5 billion to develop infrastructure such as bridges, railways, irrigation, ports, electricity, airports, clean water supply and water treatment plants. These projects equal about 80 per cent of the US$5.5 billion.
"The other 20 per cent is in the economic, tourism, financial, education, health and land sectors so there is no point saying the loans are used to buy tanks or serve individuals."
The finance minister also said that debt servicing was expected to amount to US$101 million in 2012, US$114 million in 2013 and US$259 million in 2018.
Keat Chhun also elaborated on loans for 25 projects including 10 funded by Asian Development Bank (ADB) loans, 10 by China, two from South Korea and another two from India.
He said a 292 million SDR (Special Drawing Right) loan, an interest-bearing international reserve asset created by the IMF, from China was being used to develop Ar Chang irrigation system in Kampong Chhnang province, Koh Thom Bridge in Kandal province, Stueng Stoung development in Kampong Thom, the 190-kilometre National Road No 55 in Pursat, the 118-kilometre National Road No 23 in Kandal¡¯s Lerk Dek district, and National Road No 2 in Takeo¡¯s Bati district, Stung Treng, Chi Kreng water resource development and the construction of electricity cable from Phnom Penh to Bavet.
In addition, he said a 127 million SDR loan from Japan has been used for National Road No 5 from Battambang to Sisophon and restoring irrigation in Phnom Penh.
The loan from South Korea has been used for National Road No 2 and 22 restoration projects in Kandal and Takeo provinces and the Ta Orn irrigation system.
The 37 million SDR loan from India has been used to develop the electricity network in Kratie and Stung Treng provinces and water resource development in Sva Hab.
The 271 million SDR from the ADB has used for disaster management and decentralisation, public service and financial reforms, rural roads, tourism and other sectors.
