Why is Cambodia in debt with $9 billion?

ambodia’s foreign debt tops $9 billion, with China accounting for more than 40 percent

Cambodia’s outstanding external debt reached more than $9.18 billion as of the first half of 2021 and is expected to reach more than $10 billion by the year’s end, an increase from $8.8 billion at the end of 2020.

The draft law on national budget management in 2022, presented on August 17 by the Ministry of Economic and Finance, shows that China accounted for 43.78 percent of Cambodia’s foreign debt, while multilateral partners accounted for 30.13 percent. The rest is owed to other individual countries.

Aun Pornmoniroth, the Minister of Economy and Finance, said in a speech that national revenue, especially non-tax revenue, is likely to face further decline in 2021 due to the COVID-19 and rising government spending.

“However, this huge budget deficit is not a problem as the government has additional savings to fulfill the needs,” he said.

The government spent $829​ million on combating COVID-19 in 2020 and expects to expend $1.4 billion in 2021. The government currently plans to spend an additional $910​​ million to fight the virus next year.

Pornmoniroth said that in 2022, the government will adhere to the principle of “prepare for the worst, hope for the best,” in order to have sufficient funds to fight the COVID-19 and support the economy and society in the medium term.

Read full article here: https://cambojanews.com/cambodias-foreign-debt-tops-9-billion-with-china-accounting-for-more-than-40-percent/

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