ASEAN KEY DESTINATIONS
Rice federation seeking loan
The Cambodian Rice Federation (CRF) is seeking financing from China’s Export-Import Bank (Ex-Im) to build much-needed infrastructure such as warehouses and drying facilities to hopefully increase milled rice export capacities.
Sok Puthyvuth, president of the CRF told the Post yesterday that the CRF had set up a working group charged with studying Cambodia’s rice industry and preparing a proposal for the Chinese bank’s funds.
“We are working on our internal plan before submitting to them [Ex-Im] because we need to know exactly what our current capacity is and how large a loan we need to increase that,” Puthyvuth said, declining to detail how much funding the CRF plans on asking for.
In May, during the CRF’s presidential appointment, Puthyvuth said Cambodia’s rice industry needed more than $500 million in financial assistance for industrial development.
“We are studying all aspects of rice sector’s holding capacity infrastructure including warehouses, drying, silo, seeds, everything.”
Puthyvuth said the CRF will submit the rice body’s plan to the Cambodian government for approval. If given the green light, he said a loan agreement with Ex-Im could be signed as early as next month.
Managing director of milled rice exporter Mekong Oryza Trading, Hun Lak said the industry was in urgent need of “hundreds of millions of dollars” to build the warehouses and silos needed to house Cambodia’s rice.
“It is very important for the industry. When we have all of these, we can be able to accept big order contracts,” Lak said.
“I think now the Ministry of Commerce and Ministry of Economy and Finance are still negotiating with the Chinese bank. It is a very positive sign that the government is acting to help rice exporters.”
Ken Rattha, spokesman for the Ministry of Commerce could not be reached for comment.
In Channy, CEO of Acleda Bank, which last year provided about 50 per cent of the agriculture industry’s $700 million worth of commercial banking loans, said the CRF will have to provide clear and transparent financial statements to prove the need for such a loan.
“Our country’s banking system has a lot of money to loan them but what is important is that most of them don’t have clear financial statements – that is the main issue,” said Channy.
“Any and all banks will ask about it. Of course they will likely grant them a loan, but it could again just be in small amounts.”
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