In an effort to bolster trade finance, particularly for supporting Cambodia’s micro, small and medium enterprises (MSMEs), the Foreign Trade Bank of Cambodia (FTB) and the Asian Development Bank (ADB) have collaborated through ADB’s Trade and Supply Chain Finance Programme (TSCFP).

The agreement was signed by ADB country director for Cambodia Jyotsana Varma and FTB CEO Dith Sochal at ADB’s Cambodia Resident Mission on February 6 in Phnom Penh.

As a partner bank of TSCFP, FTB will assist corporate and MSME clients by enabling trade finance instruments issued by FTB to be underwritten by TSCFP’s credit guarantees.

“This assistance is expected to help increase the number of international banks engaged in the Cambodian market,” stated ADB.

The bank said it recognises that trade plays a vital role in the country’s economic development and the new partnership will offer additional opportunities to enhance support for regional and international trade and commerce.

ADB is a major source of official development assistance (ODA) for the country, with average annual lending of $363.28 million from 2019 through 2023.

“To ensure the collaboration is as effective as possible, FTB has been actively working with TSCFP to enhance its trade facilitation expertise. TSCFP has supported FTB in developing report preparation skills, adopting good practices, implementing innovative strategies, designing training modules and establishing performance measurement criteria,” explained ADB.

Varma highlighted that the agreement signifies the bank’s commitment to private sector development, aiming to encourage broader sector participation in supporting MSMEs.

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Reporter: May Kunmakara

Publication date: 07 February 2024

Source: The Phnom Penh Post