Thailand’s Neda halts all new projects in Cambodia
Funding to construct Road R67 connecting Thailand’s Sisaket province with Cambodia’s Siem Reap paused
Following the deadly Thailand-Cambodia border skirmishes, the Neighbouring Countries Economic Development Cooperation Agency (Neda), a public organisation under the Finance Ministry, has halted all new aid investment projects in Cambodia.
According to a source from Neda who requested anonymity, no ongoing financial aid projects in Cambodia are currently under construction. One new project that has investment plans will be postponed following the clashes, the source said.
This latest investment project offered assistance to the Cambodian government to construct Road R67, and was in the contractor selection process prior to the postponement. This route connects Si Sa Ket province in Thailand with Siem Reap in Cambodia.
Although the project has already been approved, Neda paused funding until the situation improves.
Road R67 is considered a key route in Cambodia, with the project upgrading the road surface to asphalt concrete and reinforced concrete over a distance of 134 kilometres, from Siem Reap to Anlong Veng and Choam/Sa Ngam in Cambodia. The total project value is 983 million baht.
Neda offered a low interest rate of 1.5% to the Cambodian government and a repayment period of 25 years, including a seven-year grace period. The construction period was set at 24 months.
The loan conditions require the use of Thai contractors and at least 50% of the contract value must be spent on Thai goods and services.
As for other new financial aid projects for Cambodia — such as the Road R68 project that would connect Surin province with Siem Reap — a feasibility study was completed. However, Neda will not approve the project at this time, the source said.
“All new projects are on hold. Nothing will be added, except for existing contracts we are following through on,” said a senior-ranking source at Neda, adding that given the sentiment, even if projects were approved no Thai contractor would dare enter Cambodia to carry them out.
The source said over the past two years Neda has focused financial aid efforts in Cambodia on 3-4 projects, as Laos faces high levels of public debt, leaving it unprepared for further investment.
Meanwhile, Myanmar continues to struggle with internal conflict. For projects to proceed in Myanmar, Neda must wait for an election recognised by Asean, said the source. The country may hold an election this year or next.
The source said the previous conflict between Thailand and Cambodia in 2011 over the Preah Vihear Temple caused Neda to suspend aid to Cambodia for 5-6 years.
Neda has provided low-interest loans totalling 2.92 billion baht to Cambodia, accounting for 12% of Neda’s total aid to neighbouring countries.
Source: https://www.bangkokpost.com/business/general/3085444/neda-halts-all-new-projects-in-cambodia
