The British Chamber of Commerce in Cambodia is playing a key role in facilitating discussions between UK Export Finance (UKEF) and local stakeholders, aiming to bolster Cambodia’s infrastructure and public services through strategic British investment. During a three-day mission from August 5-7, the UKEF delegation, led by Vomic Nur Shah, Head of Business Origination & Client Coverage, met with senior Cambodian officials and hosted an exclusive networking session to explore collaboration opportunities under the export finance framework.
The visit included a meeting with Aun Pornmoniroth, Deputy Prime Minister and Minister of Economy and Finance, where Shah and Dominic Williams, the British Ambassador to Cambodia, discussed ways to deepen the UK-Cambodia relationship. The discussions focused on how UKEF’s financial instruments could support Cambodia’s socio-economic development.
Government-Backed Financing To Stimulate International Trade
UKEF, a UK government department, provides government-backed financing to stimulate international trade, particularly through infrastructure and energy projects that are capital-intensive and require significant liquidity. UKEF offers a variety of financial products, including direct lending and guarantees, where it underwrites loans provided by commercial banks to ensure the necessary capital for large-scale projects. One of its key offerings is a 100% guarantee on loans, covering up to 85% of the export contract value, backed by the UK Government’s AA- credit rating. This guarantee significantly reduces the risk for lending banks and makes it easier for borrowers to secure financing.
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For projects in Cambodia, UKEF has a market capacity of £1 billion to £2 billion. However, to qualify for UKEF support, a minimum of 20% of the project’s value must be spent on UK content, which can include goods, services, and intangibles originating from the UK. This condition ensures that the benefits of the financing extend to the UK economy, while also supporting the development needs of partner countries like Cambodia. UKEF also offers extended repayment terms, with up to 22 years available for renewable energy and clean growth projects.
Pornmoniroth expressed his appreciation for the ongoing cooperation, noting the significant impact of British investment on Cambodia’s growth. He emphasized the importance of diversifying funding sources for public infrastructure as the country works toward its goal of becoming a high-income nation by 2050. “Our ongoing reforms are crucial as we seek to build a resilient economy that can support our ambition of becoming a high-income country by 2050,” he stated.
Shah underscored the UK Government’s commitment to Cambodia, designating it as a priority under the British Investment Partnership. “We are exploring export financing opportunities in Cambodia to attract private sector investment, particularly from British investors,” he said. This commitment is part of the UK’s broader international development strategy, which seeks to promote sustainable economic growth in partner countries.
A Platform For In-Depth Discussions On Potential Projects
The mission also involved discussions on the ongoing development of a green special economic zone (SEZ) in Cambodia. This project, being developed under a public-private partnership mechanism, aims to mobilize investments for sustainable infrastructure, aligning with global green finance initiatives. An exclusive networking session at TRIBE Hotel Phnom Penh, facilitated by the British Chamber of Commerce, provided a platform for in-depth discussions on potential projects, underscoring the Chamber’s role as a crucial link between UKEF and local investors.
Martin McCarthy, BritCham Cambodia Chair, emphasized the Chamber’s ongoing support for bilateral business and trade opportunities, between the UK and Cambodia. “The UK is Cambodia’s 7th largest trading partner, ahead of countries like Malaysia, France and Australia, so it’s great to see the public and private sectors working together, to promote investment synergies on all sides and across all industries, to our mutual benefit.”
Dominic Williams, the British Ambassador, reiterated the UK’s dedication to supporting Cambodia’s development through strategic investments and partnerships, emphasizing the British Chamber of Commerce’s vital role in bridging the gap between UKEF and Cambodian stakeholders.
