The Multilateral Investment Guarantee Agency (MIGA), a member of the World Bank Group, has issued guarantees supporting the refinancing of existing power transmission infrastructure in Cambodia’s capital of Phnom Penh and its surroundings. The move paves the way for commercial funding to replace the facility previously offered by the Export-Import Bank of Malaysia.
The guarantees are expected to lower the cost of borrowing and help retain interest in investment in Cambodia’s infrastructure sector. Issued to Mizuho Bank and ING Bank Singapore, the guarantees amount to US$76 million and cover the lenders’ loans for up to 10 years. The guarantees will provide protection against currency inconvertibility and transfer restriction, expropriation, breach of contract, and war and civil disturbance.
This is the first-ever project finance transaction by Mizuho Bank in Cambodia, and it is also the first Japanese bank to arrange a loan in Cambodia. Likewise, these are MIGA’s first transaction guarantees in Cambodia, and they are in addition to the guarantee granted by the Cambodian government over the life of the project.