South Korea will hand out nearly $420 million in development loans to Cambodia this week, much of it for roads and other infrastructure, bringing its total assistance to more than $880 million since 2001.
The new loan agreements were to be signed today at a ceremony between Foreign Affairs Minister Prak Sokhonn and South Korean Ambassador Kim Weon-jin.
The aid follows a continuing shift in the Cambodian government’s focus from a historical friendship with North Korea to a broader diplomatic relationship with Seoul.
During a visit to Phnom Penh in June, South Korean Vice Defense Minister Hwang In-moo successfully courted Cambodian support for efforts to thwart North Korea’s nuclear ambitions following a series of weapons tests by the North. The two countries also announced a plan to sign an agreement formalizing military collaboration.
A number of projects will benefit from today’s $417.4 million cash injection. About $350 million will be used to finance priority projects through next year relating to infrastructure, irrigation, health, rural roads and sewage systems, the ministry said in a news release.
Another $67.4 million loan was to be used to upgrade National Road 48, which runs through Koh Kong province.
The deal marks 20 years since Cambodia and South Korea re-established diplomatic ties in 1997.
In July 2013, South Korea signed off on $200 million in new loans to Cambodia, which, at the time, were said to be earmarked for rehabilitating a number of national roads, including 48, and rural routes, as well as constructing a dam between Battambang and Pursat provinces, as part of a four-year deal.
“It is worth noting that the continued support from the Republic of Korea has well responded to the efforts of the Royal Government of Cambodia in improving socio-economic development as well as contributing to maintaining steady economic growth,” according to a statement about the new loans.
The South Korean Embassy said it would help plan the developments financed by the loans as well.
“Based on this framework arrangement, the two governments will work closely to develop projects in diverse sectors such as transportation, health, and the rural development sector,” it said in a separate release.
The loans are expected to “contribute to further strengthening the cooperative relationship between the two countries, which marks the 20th anniversary of re-establishing diplomatic relations,” it said, noting that South Korea has committed to $882.7 million worth of development loans to Cambodia since 2001.
Chum Sounry, spokesman for the Foreign Affairs Ministry, said he could not provide further details or comment on the deals prior to the signing ceremony, while a spokesperson for the South Korean Embassy could not be reached.