Cambodia: Gov’t likely to hike special loan to rice sector
The government’s special fund through the Agriculture and Rural Development Bank to the rice sector is expected to witness an increase to help further promote rice production.
Chan Seiha, deputy director-general of the Agriculture and Rural Development Bank, said that the bank has disbursed $80 million loan to the rice sector this year.
The one-year-period loan has contributed to the development of the rice sector in Cambodia, Seiha said.
Since 2016, the amount of emergency loans to the rice sector has increased from $27 million to $80 million in 2022, he said.
“The government is expected to provide additional loans to enhance and further develop the rice sector to boost economic growth in the aftermath of the Covid-19 crisis,” Seiha added.
The government’s special financing project has made a significant contribution, especially to the spread of Covid 19 to improve people’s livelihoods and provide food stocks in the current crisis.
“For rice exports through low-interest loans, this is a contribution to cost reduction for many rice millers owners,” he said.
The loan, with a maturity date of a year period, is offered to rice millers with lower interest rates than commercial banks.
The loans are part of a lending mechanism initiated by the government in 2016 to help millers who are short on cash buy paddy rice from farmers and keep the price of the commodity stable.
The loan is also designed for helping rice millers expand their silo and warehouses for rice production.
The ARDB has called rice millers in need of capital to apply for government emergency loans for the upcoming harvest season.
Lun Yeng, secretary-general of the Cambodia Rice Federation, applauded the move, saying that a package of special loan is the government’s effort to help lift the rice sector.
“Providing lower interest rate loans to rice millers to collect paddy rice from farmers, to expand rice mills and silo facilities are help from the government to improve the sector in Cambodia,” Yeng said.
Cambodia exported 327,000 tonnes of milled rice in the first semester this year, an increase of 16 percent compared to the same period last year, earning the country $279 million, according to a
report by the Cambodia Rice Federation.
China remained the Kingdom’s biggest export market for milled rice export during the period, the report said, citing that the export accounted for 51.43 percent of the total milled rice export, showing a 17.44 percent increase.