Fund for roads in Cambodia

Fund for roads in Mekong region
August 26, 2009

Asian Development Bank and the Republic of Korea are supporting road and border improvements in Cambodia to increase economic opportunities and boost trade and tourism in the Mekong region.

The bank’s board of directors approved a US$16.3 million loan for the project, which will upgrade 113 km of the national highway (NR56) from Sisophon, the capital of Banteay Meanchey province to Samraong in Oddar Meanchey – the northwest of the country. The funds will also be used to upgrade a cross-border post with Thailand at O’Smach.

The Ministry of Strategy and Finance of Korea is also extending a loan equivalent to US$25.6 million through its Economic Development and Cooperation Fund.

The pot-holed gravel road, that is impassable in the wet season due to flooding cuts through two of the poorest provinces in the country- Banteay Meanchey and Oddar Meanchey. It links up with another major route and forms a feeder connection to the region’s east-west corridor – a road network that links Thailand with the Gulf of Tonkin in Vietnam.

Once completed the improved road and checkpoint will aid cross-border tourism and improve overland travel time to Siem Reap – site of the world famous Angkor Wat temple.

ADB’s loan comes from its concessional fund, which will cover 34% of the project cost. It has a 32-year term with an eight-year grace period and interest rates of 1% and 1.5%. The Government of Cambodia will provide US$6 million to the project, which should be completed by December 2013.