Microfinance Focus, Nov. 26, 2009: The Asian Development Bank’s Board of Directors has approved a $10 million loan for Cambodia’s economic reforms program. It covers costs linked to implementing reforms, and also provides the government with budgetary support to help ease the effects of the global economic downturn. The latest reforms are part of the ongoing ADB second sector program support – which began in 2007 – to assist Cambodia to further develop its financial system.
Cambodia is implementing a series of reforms designed to modernize and deepen its financial system in order to support growth, reduce poverty and make the country more resilient in the face of external shocks.
Cambodia posted real economic growth of more than 9% between 2001 and 2008, and cut overall poverty. However, external shocks, such as the global financial crisis of 2008, which has pressured garment exports, tourism and foreign investment, threaten to undermine that progress. An effective financial system that can readily mobilize finance, channel it into productive areas, including to rural areas through microfinance, and manage risks, can help mitigate the impact of external turmoil and keep growth and poverty reduction on track.
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