By Sok Lak
To achieve the one million tons goal to export rice to global markets, Cambodia has 4 million tons of rice product surplus as well as increasing rice productivity and developing the rice sector. “The Cambodian Government put a lot of effort into the agriculture sector. Every year, the government spends a lot of money to support the agriculture sector to ensure production and increase productivity such as expanding and developing irrigation systems, increasing loans for rice mills and focus on attracting more investors,” senior officials said.
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| Cambodian Paddy |
“The Royal Government will continue to invest around US$220 million to expand and develop irrigation systems while the government has already invested US$101.43 million in 2009 and US$188.79 million in 2010. The government also through the Ministry of Economy and Finance, arranged financing under credit allowances without interest in the amount of US$80 million in a 3 year period (2011-2013) to Electricite Du Cambodge to invest in the construction of a sub-grid system to expand the electricity supply coverage to allow more people access to electricity to paddy producing more fertile areas and rice processing mills,” Deputy Prime Minister Keat Chhon, Minister of Economy and Finance said at the closing ceremony of the Cambodia Rice Forum 2011 on October 17 in Phnom Penh.
He added that the government has doubled the amount of agriculture sector support and increased the development fund under the Rural Development Bank (RDB) from the initial amount of US18 million to US$36 million and then added up another US$7 million to implement measures related to the purchasing and processing of rice. However, the fund has been implemented by RDB to provide credit to 251 rice mill associations throughout 10 provinces.
Moreover, the government has created a credit guaranteed scheme with the amount of 105 billion riel (US$25 million) in order to encourage commercial banks in providing loans related to the purchase of rice for stocking and processing for export. “As expected, the credit guaranteed scheme is able to attract commercial bank credit worth US$200 million for the purchase of rice for stocking and processing for export.”
The Ministry has also signed the finance cooperation agreement on the risk sharing for the agricultural and agro-industrial project with the International Finance Corporation for an amount of US$25 million to expand loans to agriculture projects including paddy-rice sector which guarantee and attract commercial banks that hold enough qualifications to provide credit to small and medium enterprises in agriculture, agro-industry sector as well as to guarantee credit worth US$50 million in the paddy rice sector, he mentioned.
“Legal procedures related to the export have been improved and the export fees, both formal and informal, have been gradually reduced and eliminated, which further contributes to strengthening Cambodia’s competitiveness.”
To achieve the goal in 2015, it is not only government efforts but also, the need for the private sector’s help needs to continue its support and
respond more actively.
Okha Te Taingpor, President of Federation of Association for Small and Medium Enterprises of Cambodia, said that rice has enormous potential compared to other sectora. “If we are able to enhance exports as per the government’s plan, it will directly contribute to Cambodia’s economy growth through creating job opportunities for people living in the rural areas, maximizing their income to alleviate their poverty, changing living standards of most farmers who have involved themselves in rural economic activities.”
However, Cambodia needs to address many challenges such as productivity, rice process, rice trade, rice export procedures and markets.
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